If you’re considering using litigation funding to provide you with financial means in litigation, you must understand how it works. The last thing you want to do is get yourself into a contract and have no idea what’s supposed to happen.
In this article, we will provide you with all of the information you need about litigation funding and what it entails.
What is Litigation Funding?
Litigation financing is a concept that has been around and used for more than 20 years. When you opt to use litigation funding, it gives you the finances that you need to pay for legal costs, including:
- Court fees
- Witness fees
- Attorney and other legal fees
Before using the litigation finance route, there are some things to consider.
How Does it Work?
The funder of the finance that you will be receiving will enter into a contractual agreement with you. In this agreement, it will outline that they are providing you the funds ahead of your litigation. You will provide them with a specified percentage amount once your lawsuit has been settled and the settlement money awarded.
The funder will first review the application that you’ve submitted to them requesting litigation funding. Next, they will discuss any potential risks that may affect the outcome of a settlement with your attorney, and if they agree to approve, the application will then send you a contract.
You must know the precise amount of money that you will need ahead of completing your application because litigation financing can be a pricey option. After you’ve signed your contract, you will then receive the funds that you need to pay for the costs that pertain to your case.
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Who is Involved in Litigation Finance
There are a couple of parties that will be involved in the litigation fiancé process that you’re about to undertake. The first person or party involved is you, the plaintiff. You’re the person that needs funding to cover all of the legal fees associated with filing a lawsuit.
The next part involved in the funding process is investors. Investors will invest in various legal claims as a means of collecting assets that give them the ability to purchase other items from the litigation offices using cash payments.
Lastly, law firms and attorneys are involved in litigation financing. Your attorneys will sit down with the investors and provide them with the valuable information that they will then use to decide whether or not to take your case. If there are more benefits than consequences to taking your case, then your application will be approved.
Litigation Funding Explained
When it comes to litigation funding, it’s crucial to know what it is and how it works before applying. You’ll want to ensure that you’ve got everything you need to build a solid case so that you can pay back the litigation funding you’ve received.
If you enjoyed reading this article and would like to read others that pertain to legal business scroll through some of the other articles published on this page.
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