Over the next several posts we’re going to examine the various issues surrounding legal or lawsuit funding and what consumers should consider to determine if legal funding is right for them.
Part 1 – Understanding and Expectations
Consumer legal funding is intended to help accident victims make ends meet while they await a fair settlement. As accident victims assess the financial options available to them, they should consider consumer legal funding as part of the solution, but not the panacea.
First, consumer legal funding is not a loan. Oasis is only paid back if the accident victim receives a fair settlement. Talking with your attorney can help you understand what your case is worth and if consumer legal funding is a good option for you. While an attorney can’t guarantee how much your case will settle for or how long it will take, he or she should be able to provide a ballpark figure. This information will help you to plan and understand your financial needs and aid in finding a solution going forward.
Expectations
Most personal injury claims do not result in multi-million dollar jury awards for the plaintiff. You should be fairly compensated for your injuries, but take care to measure your expectations against what is reasonable and fair. Understanding the reasonable outcome of your lawsuit will prepare you to plan and make sound decisions.
If your lawsuit is like the vast majority of cases in the system, it is probably safe to say that your attorney is not seeking to obtain a financial windfall. The amount your attorney is seeking should be enough, after fees and expenses, to cover your medical expenses, lost wages, repairs to your car if it was an auto accident, or in the case of a worker’s compensation claim, a sum to cover physical therapy, and then some compensation for your pain and suffering.
Once you have a solid understanding of the expected outcome of your case for both the financial award and the length of time to obtain that award, you can begin to consider your needs and if legal funding is a viable solution to help cover legal expenses. Our next post will look at what those needs may be and the potential sources to cover those needs.
Does Consumer Legal Funding Encourage Litigation?
August 2, 2010
There are those who say that consumer legal funding encourages litigation and leads to frivolous lawsuits. This is simply not true. Oasis Legal Finance is committed to upholding the highest professional ethical standards for the industry.
Oasis has set a standard in the industry that stipulates that only individuals with an existing case or claim can receive funding. Put another way, any person who seeks out funding from Oasis must already have an attorney and a viable claim. Funding companies simply do not generate lawsuits and, in fact, most fundings are made at least 6 months after a case has initiated.
In addition to industry standards that prohibit companies from generating lawsuits, there is some data to support this. A 2007 article entitled Examining the Work of State Courts: An Analysis of 2007 State Court Caseloads found an inverse relationship between consumer legal funding and the number of tort claims in the United States. The authors found that over a ten year period the number of legal fundings rose by 37% while tort caseloads decreased by 24% over the same period. Although the decrease in tort claims cannot definitively be linked to the rise in legal fundings it debunks the claim that fundings encourage and increase litigation.
Despite the fact that there are those who would like to suggest that the existence of consumer legal funding is a “bad” thing because it leads to more and more lawsuits by providing a financial incentive to people to file frivolous claims, there is simply no data to back it up. The reality is that consumer legal funding is a valuable resource for plaintiffs who need help making ends meet while they wait for their case to settle.
