There are tools that are essential to combating major medical expenses for personal injury patients: your health insurance policy, and letters of protection, or LOPs, especially for those who do not have health coverage or are underinsured.  

Using health insurance for personal injury treatment 

If you are injured in a car accident and are facing medical bills, you absolutely can and should use your health insurance plan to cover your expenses – even if you are not at fault in the incident. However, there are pitfalls to get the most out of your policy and avoid a denial of your claim.  

Pitfalls to avoid 

■ You may need to use car insurance first: Some health plans explicitly state that health coverage is ‘secondary’ to car insurance when it comes to treatment for injuries sustained in a car accident. Check your plan to see if it has this language, and, if it does, you need to use what you can in your car insurance policy. Once you have exceeded coverage limits, then move on to your health insurance coverage.  

■ Be aware of out-of-network limitations: If you choose to use health insurance, be sure to check if a medical provider you want to see is covered by the insurance company’s network. There may be restrictions on out-of-network providers.  

■ Treatment coverage limits: Likewise, some alternative treatments for your injuries may not be covered by your health plan, so be sure to check in advance if a certain type of treatment is eligible.  

■ Health insurer’s expectation of reimbursements: If you’re trying to piece together health and insurance and other sources of payment like a settlement to cover a massive medical bill, you may need to rethink that strategy: if money is coming in from another source, such as the at-fault driver’s car insurance, your health insurer will try to get some of the money it paid out back.  

■ Out-of-pocket expenses: Another thing to watch out for with health insurance is the many types of out-of-pocket expenses you will run into from the start. A quick refresher:  

► Deductible: The amount you have to pay before health coverage kicks in. The average deductible for employer-sponsored health plans in 2022 was $1,763, according to the Kaiser Family Foundation. For an estimated 28% of Americans, that would wipe out their limited savings and leave them still trying to find the remaining $763.  

► Co-pay: Your insurance might also require a co-pay for doctor visits and prescriptions. This often breaks down as the insurance company picks up 80% of the cost, leaving 20% to you. Here’s the key point: Even after you’ve reached your deductible, you will continue to have to cover the co-pay.  

► Out-of-pocket maximum: This is the point at which the health insurer picks up 100% of the costs. While you may be relieved to finally reach this point, individuals will have to pay out an average of $8,700 beforehand and families will have to cover $17,400. Remember: you will still need to continue paying your premium. Plus, if you have any out-of-network providers who are not covered, you will still be responsible for those bills as well.  

The bottom line: Your health insurance is a vital resource for you in addressing medical bills due to a car accident injury, but it’s probably best to use it as a backup, after exhausting your car insurance options, and perhaps while you’re waiting for a settlement.  

Using letters of protection (LOPs) for personal injury treatment 

For many personal injury patients, a letter of protection, or LOP (sometimes also referred to as a medical lien) can ensure they receive the care they need. For those without insurance, or who are underinsured, an LOP can be a financial lifeline.  

What it is: An LOP is essentially an agreement among the personal injury patient, a medical provider, and the attorney for the personal injury case in which payment is guaranteed to the provider from the legal settlement with an at-fault driver’s insurer.  

How it helps: An LOP means a personal injury patient does not have to wait for the resolution of their settlement to receive the medical care they need.  

Additional advantages 

■ Fair compensation: Some attorneys argue that letters of protection help personal injury patients get fair compensation in their cases.  

■ Communication between doctors and lawyers: LOPs also ensure that medical treatment aligns with the legal case. Those may seem like two entirely different processes, but treatment needs to be consistent with the arguments being made in a personal injury case. As two Texas-based attorneys note in an article on LOPs, “All too often a provider can unknowingly fail to address important issues that they do not normally focus on; for example, the cause of the injury or its impact on pre-existing conditions. As a result, plaintiffs benefit from providers who prepare medical records that clearly state the cause and extent of injury, and identify any future needs required because of those injuries suffered.” 

■ Doctors support for the legal case: Doctors treating a personal injury patient also can be witnesses in the trial. If there is an LOP in place, there is no need to pay them as medical experts, as the above attorneys note.  

■ Full payment for medical providers: Payments made through LOPs are usually at a higher rate than those used for direct insurance payments or available through Medicare. This ensures a medical provider is fully compensated for their services, making LOP a valuable tool for maintaining a practice’s financial stability, especially given the potentially long wait of a court case.  

Potential pitfalls 

■ Attorney payments: In some agreements, attorneys ensure they get paid before anyone else does. To ensure an agreement is a legitimate LOP in which your doctor will be paid, look for this language: “We agree to pay reasonable and customary charges for medical services.” If you see an LOP that does have problematic language in it, there’s a simple remedy. As one Kiplinger’s advisor notes, just “cross out the offending language on the document, initial it, have your patient initial it, and insist upon the lawyer also initialing it and returning it to you before scheduling medical procedures.” 

■ A settlement is not guaranteed: An LOP gambles on the likelihood of a personal injury case settling in the patient’s favor. If this doesn’t happen, the patient could, in theory, be on the hook for all those large medical bills. Even if the patient wins the case, the settlement amount may be too small to cover the amounts promised to the doctor in the LOP. Sometimes an attorney can negotiate with the medical provider over this. Alternatively, doctors can sell their LOPs to a third-party servicer like Gain, which assumes the liability and risk associated with these cases.  

If you’re navigating the complexities of medical expenses after a car accident, understanding your options is crucial. Whether it’s leveraging your health insurance or utilizing Letters of Protection (LOPs), having the right tools can make all the difference in your recovery journey.  

At Gain, we specialize in providing financial solutions and support for personal injury patients, ensuring you receive the care you need without the added stress of financial burdens. Don’t let medical bills overwhelm you—reach out to us today to explore how we can assist you in managing your medical expenses and securing the treatment you deserve. Contact us now to learn more about how we can help you on your path to recovery. 

The post The Role of Health Insurance and Letters of Protection in Personal Injury Claims appeared first on Gain Servicing.

Ways to get Immediate Funding While Waiting for Your Settlement Borrow from friends or family.
If you’re able to borrow money from friends or family, this may be a good option. While it’s never easy to discuss the issue of borrowing money, but your friends and family may be the most sympathetic to your situation and may even allow you to borrow without paying any interest on the funds.

Apply for a credit card. This may be a good option if your financial needs are able to be taken care of by opening a new credit card to pay for your food, bills and other vital expenses while you wait for your case to settle. Make sure to look for cards that have low introductory interest rate so that you haven’t accrued a lot of interest when your settlement comes and you’re able to pay off your balance.

Take out a second mortgage. If you own your own home, consider taking out a second mortgage to help you cover your expenses while waiting for your case to settle. If you’re unfamiliar with the process, taking out a second mortgage is essentially taking out a loan against the equity on your home. For example, if your home is worth $250,000 and the balance on your current mortgage is $200,000, you have $50,000 of equity you can borrow against. This is a high-stakes loan, as the bank places a lien on your home they are able to repossess your home if you default on the new loan.

Pursue pre-settlement funding. If none of the above options work in your current situation, pre-settlement funding could be a great fit for you. Pre-settlement funding is a new type of funding that allows investors such as Cherokee Funding to provide you with funds to help you cover your expenses while you wait for your case to settle. Pre-settlement funding is considered a lien, not a loan, so you’ll only pay it back if you win your case. Additionally, because this type of funding is considered to be non-recourse funding, meaning you only pay back your borrowed amount and usage fees if you win your case, the rates are typically higher than those you may qualify for through credit card or personal loans.

If you think pre-settlement funding is right for you, speak with your attorney or call us at Cherokee Funding so we can begin to review your case and all documentation. If your case is approved, you’ll receive funding quickly, usually within 24 hours of processing. Most people who qualify are eligible for 10-15% of their total estimated award. Contact us today for more information.

The post Exploring Funding Options for Plaintiffs appeared first on Gain Servicing.

There’s a considerable amount of misinformation and confusion out there about pre-settlement funding. Being able to discern what pre-settlement funding is, and is not, can help you get a better understand how it can help you.

It is Not: A Loan

Pre-settlement funding is mislabeled by some as a loan. This is one source of confusion. It is important to understand that there is a big difference between a pre-settlement advance and a loan. Pre-settlement funding is NOT a loan.

The difference is that you are expected to pay back a loan under any circumstance – even if you don’t win your case. The company that gives you a loan expects repayment and potentially with heavy interest. However, when it comes to pre-settlement funding, you will only pay if you win making this very different from a loan.

It is Not: A Structured Settlement

Pre-settlement funding is not the same thing as a structured settlement. You receive a structured settlement after you win your case or settle. Instead of taking all of the money from the case at once, you have it distributed to you in smaller amounts over the course of a set amount of time, such as 10 years. For example, you might be awarded $1,000,000 in a case.

With a structured settlement, you receive $100,000 every year for 10 years. Whether you decide to take a structured settlement or lump sum after your case depends on a number of factors, but doesn’t have much to do with pre-settlement funding.

It is Not: A Replacement for Your Settlement

If you apply for and receive pre-settlement funding, it’s important to understand that the advance won’t replace your actual settlement if you win. For one thing, you typically only receive between 10 and 15 percent of your expected settlement amount in the form of funding.

Receiving a portion of your anticipated settlement up front, rather than the entire thing, means that you’re not likely to spend it all before you get your day in court.

What IS Pre-Settlement Funding?

So, if pre-settlement funding isn’t a loan, a structured settlement or a substitute for an actual settlement, what is it? The funding is a non-recourse cash advance that is designed to help you pay medical bills or make ends meet while you and your attorney go after the highest possible sum in a case.

With pre-settlement funding, you won’t feel pressure to take a low ball offer or settle for less than your case is worth, as you have the cash on hand to cover your day to day needs. You are only responsible for repaying the funding if you win and you don’t have to pay any fees out of pocket or up front.

If you are waiting for your case to go to court and need help making ends meet, pre-settlement funding is the answer. At Gain, our goal is to help plaintiffs get a fair settlement in court by providing funding. To learn more about the process and what you can expect, contact us today.

The post What Pre-Settlement Cash Advance Is and Is not appeared first on Gain Servicing.

The U.S. Consumer Financial Protection Bureau found medical bills were the most common unpaid bills sent to collections. In fact, medical-related issues account for 66.5 percent of all bankruptcies. Left unpaid, medical bills can trigger financial devastation, and your credit score often suffers too.

Why Medical Debt Can Damage More Than Your Finances

Good credit takes years to build. Though a credit score is just a number, it affects the loans consumers can qualify for and their interest rates. Over a lifetime, a higher mortgage rate can cost tens of thousands in extra interest.

After an unexpected accident, your credit score likely is not your first concern.
But it should be on your list.

If your car is side-swiped and you are injured, your focus is likely to:

1. seek the care you need and recover,

2. hold the liable party responsible, and

3. pay off your ER and follow-up medical bills.

Even if the accident was not your fault, unpaid medical bills can still be sent to collections. Once that happens, the collection agency may report the debt to credit bureaus. You may also face constant debt collection calls.

That can damage both the credit you built and your future borrowing power. In many cases, medical funding can help bridge the gap before a claim is resolved.

When Unpaid Medical Bills Start Affecting Your Credit

Medical bills and personal medical history are not reported to credit agencies.
Your credit score takes a hit when unpaid medical debt goes to collections.
In fact, one collection account can drop a good credit score by 50 to 100 points.

The cost of medical care has also skyrocketed.
Few Americans have enough savings to cover unexpected medical costs on their own.
That is especially true after incidents that were not their fault. Emergency departments often lack price consistency. Insurance companies continue to profit, while many plans still leave Americans financially vulnerable.

That is why many injured plaintiffs explore medical funding or support from a medical funding company during a pending claim.

How to Protect Your Credit Score From Unpaid Medical Bills

To protect your credit score, here are some measures you can take:

1. Understand Your MedPay

MedPay, or medical payments coverage, is not health insurance. Instead, it is part of your car insurance policy.

MedPay is no-fault coverage. It can reimburse reasonable and necessary medical expenses after a car accident. This may apply to the policyholder, family members, or others injured in the covered vehicle.

Depending on your injuries, MedPay may cover some early costs. But many people still explore medical funding pre-settlement loan options when treatment continues beyond available auto coverage.

2. Ask for a Payment Plan From Your Provider

Doctors and hospitals do not report medical debt to credit bureaus. Collection agencies do. If you keep medical bills out of collections, you have a better chance of protecting your credit.

One option is asking for a monthly payment plan. Providers may work with you if they see you are making timely payments.

You should also ask whether the outstanding balance can be reduced. The application process can be tedious, but it is often worth the effort. A reduction plus a payment plan can help protect your credit.

Medical billing is complex, so stay in regular contact with your provider and insurer’s billing department. This can help you understand what you owe and how payments are reducing the balance.

There is no law requiring providers to offer payment plans. Still, it is worth asking.

Medical debts in collections can remain on your credit report for seven years. If a payment plan is not enough, some accident victims consider a medical funding case solution.

3. Hire a Trial Attorney Who Specializes in Personal Injury

There are many reasons to hire a lawyer rather than manage a claim yourself.

Insurance providers often pay more attention when a lawyer is involved. Sometimes, that attention alone can make a difference in your case. Attorneys can also work with providers to help protect your credit. They may keep bills out of collections and preserve the credit you worked hard to build.

They may also help you decide whether a medical funding company is appropriate for your case. They can also explain whether a medical funding pre-settlement loan makes sense for your situation.

4. Make Use of Medical Funding

Non-recourse medical funding can help cover medical bills and other expenses during your case. These expenses may include rent, utility bills, and car payments. Non-recourse means you repay the money only if you win or settle your case.

In some situations, a reputable medical funding company can provide needed breathing room. This can help when bills are mounting and recovery cannot wait.

Depending on the arrangement, a medical funding case may help injured plaintiffs access treatment and support. This can happen without immediate out-of-pocket payment pressure.

Many people call this help a medical funding pre-settlement loan. However, its structure is often different from a traditional loan.

Final Thoughts

If you are facing medical debt, do not let your credit score take the hit. During the claim process, there are several ways to protect the credit you worked hard to build.

That may include MedPay, payment plans, attorney support, or carefully evaluated medical funding.

The goal is the same: protect both your health and your financial future.

Remember, your credit score is more than just a number. Like you, it needs to recover well after the accident.

FAQs

How can I find companies that help reduce medical debt?

Start by speaking with your attorney. They may already know reputable options related to liens, payment negotiations, or medical funding. You can also ask providers about hardship programs or payment assistance.

If you are considering a medical funding company, review the terms carefully.

Understand the repayment structure and whether it depends on your case outcome.

The post Can Medical Funding Help You Avoid Debt After a Personal Injury? appeared first on Gain Servicing.

Your attorney should help you negotiate with the insurance company to get the best settlement possible for your case. There are a few things you can do to get the insurance provider to increase the amount it offers you.

Have Evidence to Back up Your Claim
Make sure to keep all of the documentation. An insurance company is unlikely to pay you anything if you don’t have documentation to back up your claim. You can dramatically increase your chances of getting paid by presenting the company with all the details of the accident, including the police report, your medical records and your insurance policy. Getting all of your documentation to your attorney, is the first step towards negotiating a settlement.

Your attorney can also have a paralegal do some research to see what the insurance company paid out in cases similar to yours. For example, if the company is offering you $50,000, but has paid out $150,000 in several previous cases, you can use that information to strengthen your case and increase your settlement amount.

Aim High With Your Request
One of the first rules of negotiating is never to lead with the amount you hope to get. Instead, request an amount that is anywhere from 25 to 100 percent higher than the sum you wish to receive. If you start by telling the insurance company the minimum amount you’ll accept, things can only go down from there. When you do make a high request, don’t do anything that will let the insurance company know what the lowest amount is that you’ll accept. You want to keep as much negotiating power on your side as possible.

Don’t Take the First Offer
Since you need money, it can be exciting when the insurance company responds with an offer, even if that offer is much lower than what you wanted. The second rule of negotiating a settlement is never to take the first amount offered you. Just as you requested an amount that is higher you actually anticipate, the insurance company’s first offer is actually lower than what they are prepared to pay you.

Be Patient
Insurance companies want to drag out the settlement, as they know most plaintiffs will cave in early and settle for less because they need the money. As mentioned above, the first offer is always low and you need to give your attorney time to get the right settlement. You should wait for your attorney to tell you that it’s fair settlement. Bottom line – make sure your mindset is set to be patient.

Find Funding to Tide You Over
You do have funding options to help you pay bills while you wait to get the best settlement offer possible. For example, pre-settlement funding is available and can be used to pay any of your bills. A non-recourse funding option, pre-settlement funding is not a loan and you only need to pay the money back if you win your case. Often, funding amounts are between 10 and 15 percent of your expected settlement.

Talk to your attorney to learn more about how to negotiate with an insurance company and to see if pre-settlement funding is the right choice for you. Cherokee Funding can walk you through the application and get your money to you within 24 hours of approval. Contact us today for more details and to apply.

The post 5 Ways to Get a Better Settlement appeared first on Gain Servicing.

Here’s why you’ll want to hire an experienced, trial attorney:

1. You don’t want to overwhelm yourself.

If you’ve been injured in an accident, you’re already dealing with ER visits, doctor appointments, recovery time, and physical therapy appointments, not to mention navigating how you’ll cover your medical costs. On top of all of this, you’ll be away from your full-time job, and your paychecks won’t likely be as regular. If you have family to care for or school you’re missing out on, handling your own claim can easily become an overwhelming situation, which is why hiring a trial attorney who specializes in personal injury law means you can focus on your recovery with peace of mind knowing your lawyer is taking care of business.

2. The clock is already ticking.

It takes time and effort to gather the needed materials, documents and evidence for your personal injury case. Before you even present to an insurance company, a judge or a jury, you and your attorney may need to interview witnesses, track down police reports and compile physical evidence. It’s not a job you can tackle in one afternoon making a few phone calls. Research like this can take hours, days or even months, and courts have deadlines too. An attorney working on your behalf will not only meet these crucial deadlines, they’ll likely increase the responsiveness from insurance companies, insurance adjusters and other parties involved who may be keen to drag their feet (and be downright rude) once they find out you’re handling your personal injury claim on your own

3. An attorney’s value is worth the cost.

I hear it all the time, “But attorneys are too expensive.” Or, “They take too much of the settlement.”” Legal protection comes at a cost, sure, but you’re fighting for repayment for your injuries, your mounting medical bills, time away from work, the toll this unforeseen accident may have had on your life and the lives of your family members today, but also future forward. Even your credit score is at risk in a situation like this. Personal injuries are serious and putting a price tag on each of these aspects of your life is difficult. Hiring a lawyer, who can be proactive about your legal interests, not only affects the likelihood of a positive outcome of your personal injury claim but he or she can also provide intangible guidance and peace of mind during this otherwise very stressful period of time. You’re three times more likely to receive a settlementthan if you handled your claim on your own. In my opinion, it’s too expensive not to hire a lawyer.

4. It’s okay to admit you don’t know everything. People hire professionals all the time.

Take your case seriously. Don’t be afraid to admit that taking a personal injury claim to court is outside of your scope of expertise. Plenty of people hire professionals, from accountants to plumbers to financial advisors. We all need to ask for help from time to time, and this is serious stuff. Handling your claims is not a DIY experiment. Your health is on the line, your money and your future.

5. Health insurance and medical bills are complicated.

Embedded within health insurance companies and their variety of paperwork and billing, there are plenty of intricacies and technicalities you may not be fully aware of. Personal injury lawyers know how to maneuver through these documents and processes, how to submit necessary medical treatment and other bills, all while representing you and fighting for your best interests.

If you were to file your own personal injury claim, the insurance carrier will likely offer you a nominal amount. They’re hoping you’ll just settle and walk away, in the interest of moving on from the incident. Don’t settle for less. Lawyers do make a difference, because when you work alongside legal counsel and they’re fighting on your behalf, you’ll walk away with what you deserve.

The post Why You Shouldn’t Try to Handle Your Own Personal Injury Claim appeared first on Gain Servicing.

Buying a new car every single year?

And with each passing year, it isn’t getting better.

Per capita, healthcare spending in the U.S. is almost twice the average of other developed nations. The sum cost of coverage and upfront premiums, which don’t include co-payments, are mounting. The financial toll of medical bills is causing over half a million families each year to resort to filing bankruptcy. There’s even the story of the Nobel Prize-winning physicist who sold his medal for $765,000 to pay his mounting medical bills.

It’s crazy. And unfortunately, it’s accepted as being normal.

Keep in mind, these are families simply covering the cost of care. What about the personal injury cases where someone, who may be insured or who may not have health insurance, gets hurt at no fault of their own? What then? Where can people turn?

To fill the gaps, hundreds of thousands of patients are turning to a new funding source: crowdfunding.

All hail, GoFundMe.

GoFundMe: The New Way to Afford Care

Crowdfunding is raising small amounts of money from a large number of donors online. GoFundMe is a popular crowdfunding website that was founded in 2010. Users can fundraise for any number of categories: education, nonprofit, emergency, or memorial. But, the medical category is—by far—the site’s most popular category. On the website, it reads: “We’re the leader in online medical fundraising.” Nearly 250,000 campaigns per year have been set up through the site to pay for medical costs.”

GoFundMe has raised $650 million in medical contributions. The company’s CEO, Rob Solomon, told TIME that one-third of all GoFundMe donations go towards healthcare costs.

The Upsides and Downsides of GoFundMe Campaigns

Storytelling has always been an important part of human connection, relatability and compassion.

In crowdfunding, how one tells the story becomes crucial for success. GoFundMe has become a first and last resort for people who need help paying for their medical care, and while the site opens access to anyone who wants to raise money, medical crowdfunding typically benefits people with large and relatively wealthy social networks—and whoever has the most compelling story to tell.

A trend emerges, and it’s the sympathetic and engaging stories that climb closer and closer to their fundraising goal, sometimes even surpassing it, by a lot.

It is sad Americans need to turn to a site like GoFundMe to cover the normal”costs of settling their medical bills.

Some have witnessed the GoFundMe success of others and decided to fabricate stories, scamming their friends and family, and the general public with an ongoing false narrative. Did you hear about the Mark D’Amico story? In 2017, he and then-girlfriend Katelyn McClure and homeless veteran Johnny Bobbitt made up a story about Bobbitt giving $20 to help McClure when her car ran out of gas in Philadelphia. A GoFundMe page raised over $400,000, purportedly to help Bobbitt. Other stories go on for years, as was the case with Jenny Flynn Cataldo who faked terminal cancer. She was recently sentenced to a total of 25 months and 20 days in federal prison and was also ordered to pay $81,270.03 in restitution.

Medical Funding is Another Option

Nobody is expecting a phone call that delivers a cancer diagnosis. No one expecting to become a plaintiff in a personal injury case, either. In addition to medical care, and especially if you’re out of work while you recover, living expenses like rent, utility bills, and car payments pile up. But GoFundMe is not the only way to cover your cost of care. Medical funding and non-recourse funding are additional options for personal injury patients. Non-recourse means you only pay the money back if and when you win or settle your case.

Medical funding is ideal when you may have to pay a considerable amount out-of-pocket in the form of a high deductible or to cover the costs of procedures and medicines that your insurance company will not cover. See, when a patient’s medical bills are covered, and promptly, there’s less pressure to settle the case quickly. This means a lawyer can focus on getting a client the award he or she deserves, instead of settling for the award that will yield the fastest payout.

Plaintiffs apply for medical funding themselves. During the application process, the underwriting staff from Cherokee Funding reviews your case to see if you are eligible. The process is fast and simple. Most folks are approved the same day they apply.

Despite the rising cost of care, there are ways to cover the cost, and Cherokee Funding is here to help. Find out if you qualify by filling out our simple application.

The post In an Era of Expensive Medical Care, GoFundMe Rises But It Isn’t The Only Option appeared first on Gain Servicing.

The Treatment

How long your medical treatment takes depends on your injuries, but two things are particularly important when it comes to treatment after an accident. One is that you see a doctor for treatment right away. Doing so makes it easier to connect your injuries to the accident and minimizes the chance that the insurance company has a legitimate reason to question whether or not your injury is actually related to the accident.

The other thing is to wait to file your lawsuit until you’ve reached maximum medical improvement (MMI), the point at which you’re as healed or as recovered as you’ll ever be. Waiting until you’re at MMI to file your suit means that there won’t be any surprise additional treatments that will increase your medical bills after you’ve already filed. While you do want to wait for MMI to file, you don’t want to wait to find a lawyer. While you recover, the lawyer can begin to do research to see if you have a legitimate case. Keep in mind the statute of limitations for filing. In Georgia, for example, you have two years after an injury to file a lawsuit.

Making Discovery

You don’t go to trial right after the lawsuit is filed and everyone is served. Instead, there is a discovery process, during which your attorney and the insurance company’s attorney do what they can to learn the facts of the case and to strengthen their argument. The discovery process might involve having a medical examination conducted by a doctor chosen by the insurance company, being deposed by your attorney and the opposing attorneys and answering written questions. Although the exact length of the discovery process varies, it can typically take anywhere from a few months to a full year.

Negotiations, Mediation or Trial

After discovery, your attorney and insurance company’s attorney might try to negotiate a settlement. If they can’t reach an agreement on their own, mediation might be required, which involves having a neutral third party listen to the facts of the case and make recommendations. Although mediation might only take one day, the process of negotiating can take several months.

If negotiation doesn’t work out, the case can move to trial. It might be months before your trial date and it’s possible for the date to change, based on the judge’s schedule. Once you get into the courtroom, a personal injury trial can last anywhere from a day to several months.

It can be a few years before you a see a penny of your award or settlement. If you’re concerned about making ends meet or covering your bills while you wait for trial, pre-settlement funding can help. It’s a non-recourse cash advance, usually between 10 and 15 percent of your expected settlement. You only repay it if you win. To learn more about your funding options and for details on the application process, contact Gain today.

The post How Long Does an Accident Lawsuit Case Normally Take? appeared first on Gain Servicing.

When it comes to the ethics of such funding, the Georgia Bar has made its stance clearly known.

Can Attorneys Give Funding to Cover Clients Expenses?

The big question when it comes to pre-settlement funding for plaintiffs is: can attorneys loan their clients money against a specific case?

No. Rule 1.8(e) of the State Bar clearly explains the limitations placed on attorneys when it comes to loaning money to a client. Lawyers can’t provide financial assistance to their clients, except that they can advance court costs and litigation expenses, making the repayment of those costs contingent on the case’s outcome. An attorney can also pay the court costs and fees on behalf of the client, if the client is unable to cover the costs him or herself. In order for a fee to be contingent, the agreement must be in writing and needs to state the way that fee is determined, including the percentage paid to the attorney after settlement as well as any other expenses that need to be paid.

If a client needs cash, the attorney should suggest pre-settlement funding, offered by companies such as Gain, to pay for their life needs while awaiting the results of a trial.

Funding Can’t Affect Attorney-Client Relationship

Under Rule 1.6 of the State Bar Governance Rules, any information a lawyer gets from a client over the course of their professional relationship is confidential. The State Bar has determined that a company that provides funding to a firm or attorney shouldn’t also be privy to the information given to the lawyer by his or her client. The Bar stresses that it is up to the attorney to make sure that the funding company or bank understands that it can’t interfere with a lawyer’s obligations to his or her clients.

Gain’s processes are fully adherent with Rule 1.6.

On the Question of Interest

Is it ethical for a law firm to charge its clients interest to make up for the costs related to it obtaining funding? The Georgia State Bar has determined that it is ethical for a firm to charge interest on past-due bills, as long as the client is given notice that interest will be charged on delinquent bills.

Gain offers funding to plaintiffs to help them cover everyday costs while they wait for a case to go through the court system and funding to attorneys to help improve a firm’s cash flow. Contact us today to learn more about the methods we use to determine funding and to find out why we have the best reputation in the industry.

The post Ethical Issue: What the Georgia Bar Says about Pre-Settlement Funding appeared first on Gain Servicing.

As people try to draw comparisons between non-recourse legal funding and other sources of more traditional lending, or even other hot topic financial services like payday lending, the differences become quite clear.

Here is the biggest one: When plaintiffs do not win their cases, they do not have to pay their legal funding advances back.

But that’s just the beginning.

Defining What Legal Funding Is, And Is Not
Critics of consumer financial services, like payday lending, believe they create debt treadmills, where recipients are not able to repay what is originally advanced to them, causing them to continuously roll their obligation over into new advances with never-ending payments and increasing fees.

And we agree.

In general, these less traditional, less regulated consumer financial services and the products they offer are targeting people who need the money. For most, it is the only way to pay for the basics, like rent, heat, hot water and food.

Contrary to this, the very foundation of legal funding is a contingent one. Meaning, the timeline is indefinite, and repayment may in fact never occur. The contingency of repayment owed back to the funding company is bound by the amount of the settlement, or judgment, received by the plaintiff.

Here’s the other thing: The plaintiff never pays, the defendant does.

This is the primary difference between legal funding and payday lenders and loans given out by banks and other financially-regulated institutions:

If a borrower cannot work, the lender is still entitled to repayment. In the case of legal funding, if the lawsuit fails for any reason the recipient is not required to repay the funding company.

Non-recourse legal funding is also not regulated by the federal government, and because most states have yet to put any guidelines in place to protect consumers, companies in this industry go largely unregulated.

As a potential consumer and future plaintiff, it can be tough to know which companies can be trusted, and which cannot be.

At Cherokee Funding, we strive for the most money possible for plaintiffs at settlement. We do this by advancing as little as possible and only pay the necessities regular, reoccurring bills, like rent, electricity and the cost of food, and provide coverage for necessary medical expenses for those who are uninsured or underinsured. For cases that are drawn out, this is often best done through rolling contracts where plaintiffs receive a smaller amount of money each month, thus saving them money over the long run. Sometimes this makes us unpopular, but we also know it is in the best interest of the people we are advancing funds to.

Why Companies Get into The Legal Funding Business
For all intents and purposes, legal funding companies are investors.

As a plaintiff, your case is an investment decision, but the amount advanced is only indirectly related to you.

That’s because the investors, or the legal funding companies, do not expect to receive the investment funds back. Instead, like a traditional investment opportunity, the investor anticipates that the recipient will use the funds to generate profit from some other source. In the case of legal funding, that other source is the lawsuit, award or potential settlement.

If the recipient who has been invested in is not successful in generating a profit, the source providing the funds does not receive anything in return for the advancement they have given.

It is risky, and the return on investment is dependent on a myriad of outside, uncontrollable factors. The primary uncontrollable factors in legal funding being the insurance company, the jury and the judge. The decision, as ruled in court, cannot be bought or influenced and it directly correlates to how much, if anything, a plaintiff will receive at settlement. By association, this decision directly determines how much, if anything, will be paid back to the funding company.

Like some investors, legal funding companies obtain a promise of monetary repayment in return for their contribution, if and only if the plaintiff and attorney are successful. Even in the case where they are successful, this does not always result in the total repayment of funds advanced, making the very nature of it is still a contingent one.

Concluding Thoughts
Legal funding, like investments, has no initial obligation to repay. The potential obligation to repay exists, but only given the outcome of a future, unbiased decision made in court or by an insurance company and agreed to by you and your attorney. In both instances of legal funding and investing, there is an inherent risk of non-repayment.

In summary, the two primary factors that distinguish loans from legal funding, are:

The contingent nature of the recipient’s obligation to repay

The nature of the risk of non-repayment
It is true that some traditional loans are not repaid, but the legal obligation to repay comes as soon as the loan is accepted by both the lender and the recipient. In addition, loans that are not repaid have long-term negative credit effects on the borrower.

The same cannot be said for legal funding.

In short, the risk of loan default is a personal one, made wholly on the part of the borrower, while the risk of no return on legal funding stems as a result of legal decision making, and carries none of the same weight for the plaintiff.

The post The Primary Differences Between Traditional Loans and Non-Recourse Legal Funding: Spoiler Alert, The Differences are Big appeared first on Gain Servicing.