Post Settlement Funding
Post Settlement Funding – Get Your Money Right Away
Post Settlement Funding Allows Law Firms and Plaintiffs to get some of their money in advance to help cover expenses related to, or resulting from the lengthy litigation process.
The legal system exists to provide justice when someone been wronged – unfortunately, justice is rarely expedient. A personal injury suit an take up to two years to settle or conclude. Class action lawsuits and MDL’s can take even longer. And while you are waiting for a case to reach its conclusion, expenses continue mounting. This is true for both attorney and plaintiff.
Post Settlement Funding is a financial instrument that allows attorneys and their clients to take out an advance on their settlement. This often provides much needed financial relief after waiting a long time for a case to wind its way through the court system.
About Post Settlement Funding
Post settlement funding is a financial vehicle plaintiffs and attorneys can use to receive advances on upcoming settlements or judgements. Once a case settles or concludes and a judgment award is forthcoming, the money plaintiffs or attorneys are owed can be sold to a finance company like Balanced Bridge Funding.
This arrangement allows law firms and individuals to get access to their funds right away to pay bills, or cover any other expenses that may have been incurred while a lawsuit was in process.
Post Settlement Funding is also known as Settlement Funding, third party litigation funding, or post settlement advances. Despite its various names, the specifics are always the same: The Law firm sells part of its settlement award to a finance company at a discounted rate.
If you’d like a more in-depth explanation, please check out our blog post on: Intro to Post Settlement Funding
#1: Post Settlement Funding to Take on New Clients
Law Firms are often tentative about taking on new clients and new types of cases. New clients/cases are expensive and create time-consuming work that often causes the law firm to struggle financially. Every new client a law firm takes on creates more work, which almost always means more expenses. If you are already short on cash to pay bills, it makes it harder to imagine taking on new clients, even if the payout “down the road” could be huge. But if you have Post Settlement Funding available to help keep cash in the bank account, then it becomes easier for attorneys to take on larger clientele or more projects than they would otherwise.
This scenario isn’t limited just to law firms; lots of businesses are both attracted to the idea of new accounts, and simultaneously frightened to win those accounts because of the cash crunch new customers often cause. That is why big businesses always employ third party financing – so they can continue growing without the fear of onboarding new accounts. When you have cash flow management challenges, new customers don’t solve the cash flow problem – they double it!
How Does Post Settlement Funding Work?
Once a settlement or judgement has been reached, the money owed to plaintiffs and their attorneys are considered assets. Because it is an asset, all or part of the money owed can be sold. We (Balanced Bridge Funding) purchase a portion of the amount owed to you (at a discount). You get money now, and we own the asset (a portion of the settlement funds or contingency fees you sold to us). You (the client) get some of your money right away, and we wait for the settlement funds to be paid to us directly by lead counsel, or whomever is designated to distribute the funds on behalf of the settlement.
The Post Settlement Funding Process
- Attorney has settlement in a case but will experience some delay before their contingency fee is
distributed to them. - Attorney applies for a post-settlement advance with Balanced Bridge Funding.
- Balanced Bridge examines the case. A determination is made on how much of the fee Balanced Bridge
will purchase and how much will be advanced to the attorney. - Balanced Bridge discusses the funding terms with the attorney and provides them with the agreement
to review and sign. - Once that is all completed, Balanced Bridge wires the advance directly to a bank account specified by
the attorney.
This process is often completed in a day or two but can take longer.
Once the fee is distributed, Balanced Bridge is sent its portion of the fee.
Is Post Settlement Funding a Loan?
It is NOT a Loan.
Some states have passed bills just to specify that Post Settlement Funding does not in any way meet the criteria of a loan and cannot be called a loan. Example: In 2020, Utah passed HB 312 which specifically states post settlement funding does not meet the definition of a loan or credit.
Unlike a loan, post settlement funding does not have monthly or interim payments to a lender. When your case finally pays out, your obligor pays Balanced Bridge Funding directly.
How Does Balanced Bridge Funding Get Paid?
When the settlement pays out, Balanced Bridge Funding is repaid what it is owed directly from the case administrator, lead counsel, or from the escrow account. You are paid any remainder owed to you. Remember, we purchased this asset from you. It is ours, and it is our responsibility to collect what is owed to us from the settlement or award.
What Type of Cases Can You Get Post Settlement Funding For?
We fund all types of settlements where there is a delay between time of settlement and actual payment. Here are just a few (not all) types of settlements we will fund:
- Class Actions
- SSDI
- Veterans Disability Claims
- Sexual Assault
- Infant Injuries
- Product Liability
- Personal Injury
- Truck Accidents
- Mass Torts
- Multi-District Litigation
- Employment Discrimination
- Wrongful Death
- Slip & Fall
- Medical Malpractice
- And More!
Chances are, if you are going to receive a settlement or award, you can receive funding from Balanced Bridge Funding.
Is This Type of Financing Regulated?
As of 2022, there is no federal regulation for litigation funding. Some states have begun considering regulation, and it is reasonable to expect regulation in the future and for those regulations to differ state to state.
The legal industry is policing themselves (as they tend to do) regarding legal funding. The American Bar Association (in 2020) issued a report of “best practices” for third party litigation funding. To read the full report, click here.
The Legal Funding industry has made a great deal of progress policing itself. There are at least two associations now in the Legal Funding Industry. The Alliance for Responsible Consumer Legal Funding (ARC), and the American Legal Finance Association (ALFA).
Does Balanced Bridge Funding Belong to an Association?
Yes, Balanced Bridge is a member of ARC – The Alliance for Responsible Consumer Legal Funding.
More About Legal Funding Solutions From Balanced Bridge Funding
Does Balanced Bridge Funding offer Pre-Settlement Funding as well as Post Settlement Funding?
Balanced Bridge does not offer pre-settlement funding solutions for Attorneys at this time. We do offer post settlement funding; meaning, once your case has settled or concluded, and you are owed a settlement, we can offer you a settlement advance (if you qualify). But no, we do not offer pre-settlement funding options at this time.
A Non-Recourse Transaction: We Accept All the Risk
Our funding Solutions are a non-recourse transaction. This means you don’t need to worry about what might happen if the defendant suddenly can’t pay your settlement award — we accept all risk of non-payment, meaning that you will still get to keep the money from your settlement advance if the defendant goes bankrupt or is unable to pay for whatever reason.
Fast, Hassle Free Application
In most cases we can get your money in your hands in one week or less. Our application is simple, straightforward, and easy to complete. Remember, this isn’t a loan, so there isn’t as much paperwork to go through. In most cases, we can approve your application and have your money deposited into your checking account in a matter of days.
If you think Post Settlement Funding could be the right fit for you, please call one of our Post Settlement Funding specialists at 267-457-4540. Or to apply online, simply CLICK HERE and fill out our quick form application.
