Litigation funding is a financial solution that helps individuals and law firms cover the costs of their legal proceedings. By offering critical financial resources to cover daily living expenses, attorney fees, court costs, and more, litigation funding alleviates the immediate financial strain of pursuing a legal case.
Litigation funding is less like a traditional loan and more accurately described as a cash advance on your future settlement. Technically, it is a “non-recourse loan,” which means that as the plaintiff or the plaintiff’s attorney, you take on no risk – if you lose your case, you do not have to repay the money. If you win your case, the funding provider receives a pre-determined portion of the settlement or jury award.
Types of Litigation Funding
Litigation funding comes in different forms to meet the needs of both consumers and law firms:
Consumer Litigation Funding
Consumer litigation funding arrangements typically involve a plaintiff—an individual involved in a legal dispute—seeking financial support from a funder to cover various expenses. This funding is commonly used in personal injury and tort claims.
Consider a consumer who has been injured by a defective product. In such cases, the financial burden can be significant, especially when up against a large company that may have extensive legal resources. The costs of legal action, medical bills, and regular expenses such as rent, mortgage, or car insurance payments can quickly add up.
This is where consumer litigation funding becomes crucial. It is intended to provide financial relief during the often lengthy period between when the lawsuit is first filed and the final resolution. Litigation funding allows plaintiffs to pursue fair compensation without being forced to accept lowball settlement offers due to economic hardship, effectively leveling the playing field against well-resourced insurance companies.
Law Firm/Attorney Funding
Law firm or attorney funding is a vital financial resource for legal professionals managing the expenses of their cases. It is designed to support law firms in covering various costs so they can focus on delivering exceptional legal representation without being hindered by cash flow issues.
This may include expenses such as hiring expert witnesses, costs for investigative work, paying court fees, and covering operational costs. Law firm funding enables firms to handle even the most complex or high-stakes cases without financial constraints.
How It Works
After you submit your application, Mustang Funding will review your case to determine if it meets the necessary criteria. We assess factors like the strength of your case and the likelihood of a favorable outcome. If approved, we will provide the funding needed to support your litigation.
In exchange, we will receive a percentage of the proceeds if your case is successful, as detailed in the funding agreement. In short, you get the financial support you need immediately, and you only repay us if you win.
Contact Us to Learn More About Litigation Funding
If you are curious about how litigation funding can benefit you—whether you are a consumer facing financial strain during a personal injury claim or an attorney needing support for a complex case—Mustang Funding is here to help. Our team is ready to guide you through the process and answer any questions you may have.
Reach out to us today to discover how our funding solutions can provide the financial support you need to pursue your case effectively.
