The previous post outlined why consumer legal funding does not increase the number of cases filed. By that same token, consumer legal funding does not increase the costs of litigation and to suggest otherwise is misleading at best. The truth of the matter is that the existence of consumer legal funding allows plaintiffs who are facing dire financial circumstances to get the settlement that they are entitled to without the pressure of losing their home or car, for example, forcing them to make a premature settlement decision.
Just as an attorney decides whether to take on a case based on the facts of the situation, consumer legal funding companies base their funding decisions on the merits of the case as well. Oasis employs underwriters, attorneys, and financial experts who all come together to offer the best product possible to consumers. Since the value of a case does not change based on the presence of consumer legal funding, Oasis staff are conservative in their funding decisions. Given that attorneys in these cases are already working on a contingency fee basis and therefore absorb all costs associated with the case until a resolution is reached, there is no need for an Oasis client to use the funding they receive to pay any legal costs.
Perhaps most important to note is that at no point is Oasis involved in the outcome of a case. We have no further involvement after a contract is signed and a funding is made. We do not weigh in on any aspect of the case including settlement offers and in fact, when cases settle for lower than anticipated, it requires us to reduce our fee. The funding that Oasis provides to consumers does not increase litigation costs, but rather, ensures that plaintiffs don’t have to endure excessive hardship while they wait for a fair settlement to be reached in their case.
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.
Change of View: Attorney Now Finds Value in Legal Funding
February 26, 2010
I want to share a story with the attorneys that are still ambivalent about legal funding. Yesterday I had a conversation with an attorney in Florida, about his client that was in desperate need of money or her house was going into foreclosure. The attorney told me that his client, a nurse of 20 years, could not continue to work in the same capacity after her fusion back surgery. The surgery was required as a result of injuries she suffered in a major car accident. In fact, she may never again be able to bear weight on her feet for an extended period of time.
The attorney continued to say that his client is the bread winner in her home and is raising three children. The attorney mentioned that she has nowhere else to turn for money. She has no living parents and her credit cards are all at there limits! The attorney told her to call Oasis Legal Finance and they will be able to help her get the financial aid she needed.
This is not an atypical case for legal funding. What is new is the change in view from the attorney. Two years ago this same attorney told me he would NEVER refer a client for legal funding.
I called him to thank him for the referral and asked him what had changed his mind. He told me that he lost two clients last year because he wouldn’t let them get legal funding, even though they needed the money. However, he only found out the reason he lost those two clients later, after they had switched attorneys. He also found out that each of their cases settled for over 100k. He told me he would never make that mistake again. He would use legal funding and would refer his cases to me as long as I listen to him about the funding amount because he knows the case the best. He continued that if I could work in that capacity that we would have a long happy relationship.
I assured the attorney as I do all my attorneys all over the country that Oasis Legal finance is the largest legal funding company for a reason and I would never over fund his cases. We now have a great working relationship and he only calls me when his clients are in a financial bind and need money quick.
- Ila Mellul Sr. Legal Director
When is Legal Funding a Good Solution – Part 3, Options
February 5, 2010
If you’ve determined that your expenses are going to be greater than your income as you wait for your lawsuit to settle, what options do you have to get the cash you need to pay your bills? As we mentioned in Part 2 of this series, there are several options to obtain financial help and we’re going to briefly go through each to help you determine which might be the best solution for you. With any option it is critical that you weigh the risks, costs, and benefits associated with each.
There are three main avenues to investigate to get the cash you’ll need to help you pay your bills.
1. Family and Friends. Hopefully your family, and sometimes your friends, can be a source to borrow the funds you need. On occasion however this can lead to a sensitive situation and a damaged relationship if you’re unable to pay them back.
2. Credit / loans. This option may not be such a good idea as both credit cards or equity loans require a minimum monthly re-payment. Another monthly payment is usually the last thing you need if you’re already in (or going to be in the future) financial need. As well, this option often takes weeks to obtain the actual cash, and a loan requires something of value that the lender can hold as collateral (i.e house, car, jewelry, etc.) . If your situation ends up where you can’t repay the loan, the lender can take your collateral and your credit score can be damaged.
3. Legal funding. A legal funding is perhaps the easiest and least risky out of all the options. A legal funding is non-recourse, which simply means that if you lose your case then you do not pay back the amount funded to you. Also, unlike a cash advance or a loan, you do not have begin repaying the loan or cash advance in the form of make monthly payments. Legal funding is also quick, from the time you apply, we speak to your attorney, and approve your funding, you can get the cash that very same day.
To help reviewing each of these options, talk to your family and/or a trusted advisor. It is best to get several opinions prior to making a final decision. Also, make sure your attorney knows of your financial situation. Your attorney’s experience may shed some light on the pros and cons of these options. If you choose a legal funding as your solution your attorney will have to be involved, so it would make sense to make them aware of what you’re thinking sooner than later.
The bottom line is, first understand what to expect out of the legal process – more specifically your case. The best person to help here is your attorney. Don’t be afraid to ask them questions about your case and what to expect , not only in the beginning but even as your case is progressing toward resolution. Second, determine if you will need financial help during your lawsuit, and third, if you do need help carefully weigh all your options.
Obviously, we think that a legal funding is most often the best solution as it offers fast cash with the least amount of risk. If you have questions and want to investigate how a legal funding may benefit your situation, feel free to click though to our website link here – oasis.
Legal Funding benefits both Attorneys and their Plaintiffs
January 21, 2010
From time to time, we run into situations where Attorneys question legal funding and they wonder how we can actually help them out. The more we work with Attorneys, the more I hear about different ways in which we are able to help the Attorney and the plaintiff with a legal funding.
I got a call from an Attorney that I had only worked with once before. He was calling me to find out what the total payoff was for a previous legal funding. He also wanted to thank me for being able to provide such a wonderful service for him and for his plaintiff.
For this case the attorney had a plaintiff that came in with a significant back injury. He was rear ended by a SUV. They were given an offer right away for approximately $15,000. The plaintiff was in an urgent situation and was on the verge of losing his home. The plaintiff wanted to take the offer so he could keep his home. The Attorney suggested that get legal funding from Oasis. We were able to fund the case for $6000 so the plaintiff could keep his home. This gave the Attorney time to work toward a larger award on the case and gave time for the plaintiff to get the appropriate treatment for his back injury.
Almost a year later, the Attorney was able to settle the case for $250,000. The Attorney was able to get a fair settlement for his Plaintiff and the plaintiff avoided losing his home.
