Can My Lawyer Deny Me from Getting A Pre-Settlement Loan?
A lawsuit funding company must obtain information from your attorney before making an offer. Obtaining litigation funding, therefore, requires your lawyer’s cooperation. If your legal counsel refuses to cooperate, then you won’t get much-needed cash to pay for medical bills, utilities, rent, and other financial obligations while your personal injury case is pending.
If you’re injured and out of work, you’re only going to go deeper into debt without financial assistance. To obtain a lawsuit cash advance, you need your lawyer’s cooperation with the underwriting process. They must also sign a legal funding contract agreement.
Most attorneys understand the challenges their clients face. A personal injury case can last for months, if not years, while negotiations with insurers, pre-trial discovery, and other legal steps continue. To complicate matters, an attorney cannot loan money to a client as an advance against potential settlement funds. It violates professional ethics and is legally a conflict of interest.
If your attorney lent you money directly, they’d lose their law license.
But lawyers also know you might be forced to settle early. That would mean settling for much less than your case is worth. While they can’t provide an advance on your settlement, an attorney can advance funds to pay for legal costs, meaning court and witness fees and deposition expenses could be covered, so the money to support your lawsuit is available.
Lawsuit Loans Require an Attorney’s Cooperation
A lawsuit funding company invests directly in your case, so they must know exactly how much it is worth. Only your attorney knows this. For you to receive funding, they must reveal all the facts of your case. For the most part, personal injury attorneys discourage this as it waves the attorney-client privilege. The details of your case are no longer known exclusively by you and your lawyer.
When you consent to any case information being turned over:
- You lose control of where the details end up.
- An agreement guaranteeing repayment of the advance must be signed (by you and your legal counsel).
- Your attorney becomes a trustee of the company and must agree to protect its interests, meaning it gets your money before you do.
The attorney-client privilege is, therefore, one of the biggest barriers to legal funding. Your lawyer may be reluctant to breach privilege because it’s based on their legal duty to be your fiduciary. After all, an attorney is obligated to protect your best interests.
How a Funding Company Determines If You Qualify for an Advance
Unlike a traditional loan, you don’t need to put up any collateral to obtain pre-settlement funding. Your credit is not a factor either. From the funding company’s point of view, if your case has a good chance of winning, and the settlement amount will be large enough to repay the advance, it will likely approve your request. Underwriters evaluate the case based on the details your attorney provides; then they look at similar cases and average settlement amounts to determine what to offer.
Let Us Work with Your Attorney
It is always possible your attorney may deny your request to obtain a pre-settlement loan. At FCA Legal Funding, we offer non-recourse legal funding with nothing paid out of pocket. We’re experienced in a wide range of cases and prepared to discuss your case with your attorney. It takes just seconds to apply and, once we speak to your lawyer, can provide the cash you need in as little as 24 hours. Apply now or call 310-424-5176 for help.