Personal injury lawyers charge a contingency fee, in an effort to assist those victims that have suffered a terrible loss. Yet some victims/clients struggle to manage financially, while working with an attorney to win a fair compensation.
What is a contingency fee?
It is an agreed-upon percent of the award granted to the plaintiff. The court grants that percent of the award to the plaintiff’s attorney. The award gets sent to the attorney’s office, and the client’s lawyer takes out the agreed-upon fee, before giving the rest to the client.
What is a pre-settlement lawsuit fund?
That is a cash advance given to the injured party, following an accident. That cash should not get viewed as a loan. The legal system does not view such funds as loans. The lender cannot be certain of being repaid. The lender only gets paid if the person taking the funds, the plaintiff wins the desired compensation. If the 2 sides do no reach an agreement, the lender does not get repaid. The advanced cash can be used to fund a lawsuit. Still, there is no guarantee that the victim/plaintiff will win that lawsuit.
Why would someone make a cash advance to an injured victim, when there is no certainty, regarding the winning of a sizeable compensation?
The companies that offer pre-settlement lawsuit funds usually charge a big fee. That fee gets taken out of the money that the plaintiff has won from the defendant. Because the plaintiff’s lawyer also receives a portion of the money won, the size of the final “pot,” the one that gets handed to the plaintiff can be quite small.
Is there any risk to a plaintiff that has chosen to seek a pre-settlement lawsuit fund?
Usually, the company that offers such a fund seeks some indication of the plaintiff’s chances for winning a fair-sized compensation. In order to obtain such an indication, it seeks some information from the plaintiff’s lawyer. Normally, a personal injury lawyer in Sherwood Park does not share a client’s information with others. However, those clients that are seeking pre-settlement funds may elect to do so. They would probably sign a document that would grant their lawyer permission to share the information of interest to the company that grants the cash advance.
In other words, anyone that goes after such a cash advance should think long and hard about the need to sacrifice the privacy that most clients enjoy. If a lawyer’s client does not want to relinquish the opportunity to enjoy the advantages linked to the lawyer-client privilege, then that same client should not pursue the chance to receive a pre-settlement lawsuit fund. Consider other sources of financial help, such as credit cards, or money borrowed from a relative.