In Parts 1 and 2, we discussed the ways in which plaintiffs could assess both the benefits and liabilities that accrue when pursuing either a lawsuit loan or lawsuit funding. In this article, we will discuss what happens once the pre-settlement loan is obtained.

Many of our clients come to us asking, "How do we repay a lawsuit loan?" It is very important for clients to realize that when obtaining this form of financial assistance, there are no upfront fees, your credit history is not an issue, and you have to pay nothing unless and until your claim is settled. The time at which a lawsuit loan or lawsuit funding would be repaid would be once the claim is actually settled. This assumes of course that the claim is settled in the plaintiff's favor.

Lawsuit loans and lawsuit funding are non-recourse financial instruments. Therefore, the funding-entities will be reviewing your case very carefully to determine whether your case is worth their investment. Due to the fact that these are non-recourse instruments, if the plaintiff does not win their lawsuit, they pay nothing.

Clients are often relieved to find that there are no limitations as to how the settlement loan may be spent. Many clients utilize such financial assistance to pay their utilities, put food on their tables, etc. However, these instruments are extremely flexible and the plaintiff is free to utilize the proceeds in any manner he/she deems appropriate.

Another question we frequently receive is, "If I need more money in the future, am I able to pursue another pre-settlement loan?" The short answer this question is, "Yes." It is possible for the plaintiff to request additional funding out of the initial request. It is also possible for the plaintiff to submit a subsequent request to obtain a settlement loan.

Both plaintiffs and attorneys are eager to find out whether the funding-entity exercises any control over the manner in which the case is prosecuted. No, the funding-entity plays absolutely no role in the manner in which the case will be prosecuted. In fact, once the monies are advanced, the funding-entity will have no involvement until such time that the case is finally settled in the plaintiff's favor and an award is issued.

It is interesting to note that many clients are concerned about the manner in which attorneys will view a request for a pre-settlement loan. It is unfortunate that a relatively large number of attorneys are totally unaware that such financial assistance is available for their clients. However, many attorneys who are aware of such funding are eager to assist their clients in obtaining the financial assistance they need to be able to continue to pursue the litigation against the defendant.

In fact, many attorneys would love to be able to financially assist their clients in pursuing litigation. However, prohibitions exist that would preclude attorneys from being able to do so. This prohibition exists principally due to a concern that a conflict-of-interest would arise between the client and his/attorney if such funding were advanced by the law firm. (It is significant to note that many attorneys are willing to advance funds for case-related expenses to their clients.)

Many of our clients also want to know whether the negotiations between the plaintiffs and the funding-entities are confidential. Yes, such negotiations are confidential. In fact, unless the plaintiff elects to notify the defendant that such monies have been obtained, the defendant need not be aware of this transaction at any time during the course of litigation. There are situations, however, in which the plaintiff may want to put the defendant on notice that individuals experienced in reviewing such matters have deemed the plaintiff's case sufficiently meritorious to advance either lawsuit loan or lawsuit funding.

Obtaining either a lawsuit loan or lawsuit funding may be one of the best courses of action the plaintiff could pursue. Many plaintiffs find themselves extremely stressed due to the financial-burdens that exist while pursuing litigation. Once settlement loans are obtained, plaintiffs are often able to breathe a sigh of relief knowing that they are no longer financially underwater!