A Guide to Trial Financing

A Guide to Trial Financing

It's been done in movies all the time. Someone's rights are violated, they take the culprit to court, a whole series of dramatic consequences, and finally, the offended party called the plaintiff wins the case against the violin called the defendant. But, as we know, it's rarely as sharp and dry as in real life. What films fail to tell about the legal process is that legal proceedings cost money, usually very large amounts of money on it. So what do you do if you have some money and need legal aid?

There are companies willing to lend money to people who need it in exchange for either part of the settlement or a monthly fee. The following is an overview of how legal funding is and how it can help you in terms of your legal needs.

Court Financing: An Overview

When a trial financing company decides to help you with a trial it makes an investment on you and your fall validity. The Financing Company calculates with reasonable certainty how much you can win if you win the case or if you allow a third-party solution. It aims to make a profit on your case as a return on investment. That means you have to pay for your funding with the money you get from winning the case.

The first way to pay for your trial financing is with a fixed amount agreed upon by you and the finance company. This is sometimes also referred to as a flat rate payment. In addition to the initial amount paid to you, the finance company will require you to pay 10 percent in interest as a return on investment, but it may vary from state to state and from company to company.

The second way to pay for your financing is by recurring payment. Made every month is recurring payment approximately as an insurance premium. However, you may be required to pay as much as 15 percent in interest on the initial amount lent to you.

Which payment method to use

In general, if you or your lawyer predict that the case goes to court, expect litigation and legal proceedings to take a while. In this case, you can choose a fixed fee, which may be less than the total cost if you had chosen to pay a recurring fee. On the other hand, if you expect a quick settlement, the recurring fee may be the best for you. However, be sure to shop and be selective about the finance company you accept. Visit a company and use the options that it offers as a starting point to determine what is best for you. Just think that the nature of trial financing is business. Whichever method of payment you choose, the finance company will earn money from you. Your task is to make your earnings as painless as possible for you.



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