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Contact us 24/7

888-711-3599

Legal funding FAQ's

What can we help you with? Answers to some of our most commonly asked questions in the legal funding industry are below.

FAQ's by category

What is pre-settlement funding?

Pre-settlement funding is a cash advance provided to victims pursuing a legal battle. This means that plaintiffs can borrow money against their future settlement award and, sometimes, judgments. Also known as lawsuit funding or lawsuit loans, a settlement advance is a non-recourse financing agreement. Non-recourse funding means that there is no further obligation to repay the advance if you lose your case. Pre-settlement funding is an investment in the outcome of your lawsuit. We are advancing you money because we think your case is strong enough to win and pay us back.

What is the pre-settlement funding process?

  • The first step is to apply either online or by phone at (888) 711-3599.
  • Secondly, underwriting will analyze legal merits and parties involved, the strength of your litigation, and the defendant’s ability to compensate for damages.
  • Once approved, you will get a funding contract that can be sent via email, fax, or FedEx. Once you and your attorney complete the agreement, your funds will be sent to you within 1-2 hours.

Pre-settlement funding qualification.

An attorney must represent you to pre-qualify. You must be 18+ to request funding. Your case must be secure and you must have a high probability of winning it.

How can lawsuit funding help me?

Pre-settlement funding can help bridge the gap between your accident and your settlement. If you need money but can’t work and have all types of bills because of your accident, a settlement advance could be the right decision for you. If you receive a settlement advance to help cover living expenses, it gives your attorney ample time to make sure you get the most value out of your settlement instead of settling sooner because you need cash now. A settlement advance helps you get through today, so you get the most out of your settlement award tomorrow.

How much money can I get?

The highest amount we will advance you is 20% of what your case is worth at the moment - if approved. The size of your lawsuit and other crucial unique information to your case will be the key to advancing you the funds you need. Baker Street Funding funds from its own private fund, and if we deny you, we work with companies that can offer to fund between $1,500 - $750,000 + depending on the details of your claim.

How are funds disbursed?

Pre-settlement funds are sent directly to your personal bank account under your name or to the personal account of a family member under certain requisites and proof of account ownership. The money can also be overnighted via FedEx to your home address.

Can I get additional funding?

You can get additional funding as long as your case supports it. Baker Street Funding buys out most pre-settlement funding agreements from other companies. We offer plaintiffs the ability to consolidate their previous advances and save money on future payments. Not every case is large enough to justify multiple funding, but 80% of the claims we approve, are re-approved for additional funding.

Criteria to obtain additional funding

As long as your legal action is significant enough to warrant compensation, you may be able to get an additional advance.

  1. Your claim has to have progressed since the last time you received a pre-settlement advance, either procedurally or through the plaintiff having further medical treatment.
  2. The case value needs to merit additional funding.
  3. There can not be any open appeals.

Are there any risks involved with pre-settlement funding?

No, pre-settlement funding has no risk. In the adversity that you lose your claim, the advanced funds will be forgiven.

How fast is the process?

We will get you your funds as soon as possible. It all depends on how fast we get all your case documents from your attorney. Our underwriter will speak with your attorney and review your case before giving you a final offer. We approve funding within 24 hours of receiving all case documentation.

Can I get a pre-settlement advance if I don't have an attorney?

No funding company will provide funds without an attorney’s representation. Our underwriter will need to speak to your attorney in each and every case with no exceptions before agreeing to buy a portion of your coming settlement. If you need an attorney, please contact us, and we will recommend you a great attorney.

Who can apply for settlement funding?

If you are represented by an attorney and have a pending personal injury, discrimination, wrongful imprisonment, or car accident lawsuit, you can apply for pre-settlement and settlement funding.

Do I qualify if I don't have a job or good credit?

Settlement funding is strictly based on your case's merits and outcome; therefore, there is no job requirement, no credit check, and no monthly payments. Just like every investment, settlement advances have a high risk for funding companies. The risk we take is that we do not get paid back if your case is not successfully settled.

What are the interest rates?

Our settlement funding contracts are custom-tailored to each case, and our rates are decided on a case by case basis. We have some of the lowest rates in the industry; we normally price contracts anywhere from 1.5-3.4% monthly non-compounding. The rate does not rise over time and is set until your case settles.

Does my attorney determine my approval amount?

Your attorney can and should advise you on choosing the right pre-settlement funding company. While they can not pick what funding company you choose to work with, we encourage clients to speak to their attorney throughout the funding process to better understand the requirements for approval.

Are there prepayment penalties?

No, you can pay off your lawsuit loan early without incurring a prepayment penalty. Remember, pre-settlement funding is non-recourse, so if anything goes wrong with your case and does not settle in your favor, and you have already started to pay off your loan, you won't get those payments back.

What is the process for plaintiff lawsuit funding?

If your client would like to apply for funding, they will need to fill out the application form or answer a few questions from one of our team members so that we may determine initial eligibility. Baker Street Funding will then ask you for some documentation surrounding your client's claim. Generally, we will require documentation establishing liability, injuries, and insurance information for the defendant. Once we receive those documents we will review the claim and most times will be able to make a funding decision immediately after. If we have additional questions or need clarity regarding certain documentation, we will email you our questions. Once those questions are answered we will then be able to make our funding decision. Once a funding decision is made, we will provide you and your client with a copy of our funding agreement. After we have reviewed the agreement with your client and answered any questions you may have regarding the agreement, we will ask the client to execute the paperwork and have you provide us with acknowledgment of our lien. After receiving both client signature and attorney acknowledgment we will release funds to the client in the manner they request (bank wire or check).

 

How do you decide the amount of lawsuit financing advances to plaintiffs?

After discussing your client's needs and financial situation, we will analyze the claim. We base our funding decisions on our perceived net present value of the claim and will structure our funding amounts based on that value and the client's needs.

 

What are the minimum amounts a plaintiff can get?

Baker Street Funding will advance a minimum of $1,500 in funding to plaintiffs involved in non-settled claims. On settled claims, we require that the gross amount due to the plaintiff be no less than $50,000.

 

What are the interest rates for plaintiff financing?

At Baker Street Funding we strive to provide our clients with the best rates and fees available. Our contracts are priced on a case by case basis but generally will be around 3% a month. We provide reduced rates for clients that are referred to us by their attorney or medical provider.

 

I do not wish my client to get funding. 

If you do not wish for your client to get funding, we kindly ask that you notify us of that in advance of us conducting our due diligence on the claim. We value your time and opinion and invite you to learn about our firm and how we can provide smart financial solutions to both attorneys and their clients.

 

What are the chances my client will be approved for a legal funding advance?

Baker Street Funding’s initial review of your application is based on our initial phone call, where you will provide publicly available information about your client’s claim. If interest is expressed and depending on your client’s needs, we may require further documentation and a scheduled call with our underwriter. Based on that call/communication and documentation, our underwriter will make the ultimate funding decision. Most cases sent by attorneys get funded because attorneys usually send strong claims.

Can legal financing affect attorney-client confidentiality?

Our involvement as investors does not affect the attorney-client privilege. Multiple recent rulings in all matter of courts have upheld the fact that conversations with third-party lawsuit funding companies are protected by common interest doctrine and thus deemed privileged and confidential. You can rest assure that you are in no way waiving any of your legal rights to confidentiality by seeking pre-settlement funding for your client.

 

Is plaintiff litigation funding legal?

Lawsuit funding or plaintiff litigation funding is legal and provided in almost every state in the country. While state requirements are different in every state, we maintain compliance with the regulations in every state we fund.

 

Are there any upfront fees?

No, there are no upfront fees for Baker Street Funding to review your case or at the time of funding. We are compensated only upon the successful settlement of your client's claim. Since all funding provided is non-recourse, your client is under no obligation to repay the funds if the case does not reach a successful settlement and payment is due when funds arrive in escrow.

What types of cases make good candidates for litigation financing?

Typically, litigation funding is an extremely selective industry. We look for claims that have a minimum damages value of $10 million or more. Any plaintiff looking to minimize their equity exposure on litigation that can be lengthy and unpredictable or is looking to hedge against a sub-optimal outcome would be a good candidate for litigation funding. The recovery on the claim should greatly exceed the cost to litigate as well as the amount of financing that the plaintiff is looking to secure. Most types of claims are eligible for financing at any procedural stage.

 

Litigation funding vs. traditional financing

Many law firms looking for lines of credit approach to their local or national financial institution. These banks may provide you with a business loan or a LOC (line of credit). The problem with these products is twofold. They do not take into account the intricacies of running a legal practice and, most times, do not provide enough capital as is needed. The other issue is that unless your firm has had a long-standing relationship with the bank, you will need to personally guarantee the financing. That means you are risking the money you’ve made to secure the funds you need to make in the future. With Baker Street Funding, those worries are taken care of. Our attorney funding process is based on your current and former case portfolio. We also take into account intangible things, such as your previously settled cases. Our funding agreements are non-recourse, and thus you never have to personally guarantee our contracts.

 

What is litigation funding for attorneys?

Litigation funding for law firms is a type of legal funding service that is created specifically for contingency fee-based attorneys, representing personal injury plaintiffs and large commercial litigation lawsuits. There are multiple different subsets of funding for lawyers, including case cost financing, voucher funding, attorney lines of credit, and post-settlement fee advances.

 

What are the benefits of litigation financing?

There are many benefits to financing a claim. For small and mid-size companies, the cost of litigation can be daunting and have an adverse impact on their ability to do business on a day to day basis. Litigation financing helps minimize the financial impact as well as hedges against the risk of an adverse outcome. For attorneys, a typical case in the litigation process does not go to trial and it takes an average of 20 months to settle. When litigating a case, that timeline extends and there is uncertainty surrounding whether you will successfully win a judgment. This process makes running a successful practice difficult and attorneys need some sort of financial backstop to help cover costs until their next case settles. Contingency fee attorneys are not guaranteed any economic benefit unless they win their case. If an attorney invests years of time, effort, and capital into a case that settles in favor of the defendant, he or she walks away with nothing. Litigation financing can offer a multitude of options for law firms and can help increase the firm’s capacity for new claims through risk-sharing agreements.

 

What are the downsides of litigation financing? 

As with any financial product, litigation financing does have a downside. The first and most talked about downside would be cost. Non-recourse financing by nature is an expensive option. Because of the large amount of risk assumed by the funding company, the required rate of return must be commensurate to that risk. Another downside to litigation funding is the process itself. Analyzing a claim is a laborious and time-consuming process that has no guaranteed successful outcome. There is always the chance that a litigation funder goes through the long process of due diligence and ultimately decides not to invest into a claim. 

 

What information does a litigation finance company need from me? 

Most of the information provided to a funder will be provided through the plaintiff's counsel. Litigation funders will do a deep dive into your case so that they understand the risks and potential outcomes of the litigation. They will do a thorough review of all documentation that has or will be produced in discovery in addition to one or multiple conference calls with both client and counsel. Reputable litigation funders will never ask for information or documentation beyond to scope of your attorney's work product so that all information is protected through attorney client privilege. You should also be aware that documentation and information related to the case that is shared with a litigation funder is protected whether or not the funder invests into the claim.

 

How long does a litigation funding contract typically take to generate?

The litigation finance process is different from lawsuit financing and a lot more complex. This includes an in-depth analysis of a case or portfolio of cases (for attorneys). Normally the due diligence period for litigation funders is 60-90 days. The speed of this process is normally dictated by how complex a case is. Once an initial review is complete, the funder will normally offer a term sheet to the client. If the term sheet is agreed-to by both parties, the funder will then complete a final due diligence check. This can take anywhere from a week to two months. Once that process is complete and a contract is dually executed, funds will be distributed to the client.

 

At what stages of litigation is legal funding available?

Funders will normally fund a claim in any stage of litigation from pre-litigation to post-settlement.

 

What happens if the case is lost?

Since litigation funding is a non-recourse investment, if there is no recovery or if the case is lost, you are under no obligation to repay the funds.

 

What type of companies can apply for litigation financing?

Any company regardless of size or status is eligible for litigation funding. Any company looking to limit equity and risk exposure generated through litigation is a good candidate for funding. Most companies, regardless of size, only have a limited amount of resources that they can dedicate to legal matters. If a company is using all of those resources or has used all of those resources, then litigation funding may be a good solution for them.

 

How can litigation funding help my practice?

Litigation funding can become a great asset to your practice by helping you gain access to case flow to help pay expenses while waiting for a case to settle or go to litigation. While each attorney and firm's situation is different, we have created a bespoke solution for every different type of attorney financing need. We can help you manage your portfolio of cases and provide capital based on that portfolio to help with payroll, office space, and marketing capital, or we can provide case by case specific financing to help cover discovery costs, expert witness costs, administrative expenses, and litigation expenses.

 

Legal funding definition

Legal funding is when a legal financing company provides an attorney or a plaintiff with a portion of their settlement or fees in advance of the case settling or after it settles.

 

What type of products do you offer?

Baker Street Funding provides the following products: lawsuit funding, post-settlement funding, attorney funding, surgery funding, and corporate litigation funding.

 

What areas do you serve?

  • Attorney funding is provided throughout all states of North America.

 

What type of cases fo you fund?

Personal injury

Auto and motor vehicle accidents

Civil rights

Employment and labor

Corporate litigation

Settled Cases

Our legal funding team is here when you need us. Give us a call for a free consultation at (888) 711-3599.

Baker Street Funding helps you Get Your Legal Funds Now.

Select a legal funding product to get started:

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Or just call us at 888.711.3599 to apply.