As Plaintiff’s lawyers we are focused on maximizing results for our clients.
Ironically, however, we don’t always focus on maximizing the profitability of our own firms!
Devising a more sophisticated strategy to finance your case costs can free up cash spent on existing cases -- i.e., refinance the costs and take the cash out -- and financing case costs from the beginning of your cases will leave you with more resources to invest in your firm’s growth.
Below, we explore how case cost financing has traditionally been done and compare it to the way things should be done to enhance your firm’s revenue and income.
Most Plaintiff’s attorneys have traditionally advanced case costs with their own funds. At first blush, this solution appears simple, familiar, and avoids debt. The problem is those funds are sidelined indefinitely, preventing you from accepting more cases, advertising, increasing your headcount, investing in technology solutions, or just generally nurturing your firm’s growth.
Whether we like to admit it or not, this approach also converts the firm into its client’s creditor with interest-free loans from the firm’s after-tax dollars. This dynamic can sometimes cloud our spending decisions in a case when our priority should always be obtaining the best possible results for the client.
Although familiar – and, for many of us, a direct result of our training — self-funding our client’s case costs is not as simple as it seems, can be adverse to law firm growth, and diverts money away from better revenue growth opportunities.
Bank loans are sometimes available to Plaintiff’s lawyers. We are, however, always confronted with a significant barrier: The most valuable asset of our business – i.e., unrealized contingency fees -- are unique and difficult for bankers to understand and lend against. This creates a dynamic where banks either refuse to finance Plaintiff’s lawyers, don’t offer us enough, or make the process so cumbersome that it feels like applying for a mortgage.
If you’re lucky enough to get approved, bank loans often include unreasonable and intrusive conditions. Banks may obligate borrowers to terminate their relationships with other banks; to buy life insurance for the bank’s benefit; to provide additional, personal collateral; or to keep their loan balance at zero for up to 90 consecutive days, pursuant to annual clean-up provisions.
While banks may advertise attractive rates, the reality of their way of dealing with Plaintiff’s lawyers often makes this an unrealistic option.
Once a Plaintiff’s attorney decides to finance case costs, s/he is usually frustrated by the lack quality options. Enter LevelEsq: Built for and by Plaintiff’s attorneys, LevelEsq understands the financial nuances of a contingency practice and has the solutions -- case cost financing and case cost insurance -- and expertise to help you increase your firm’s profitability.
LevelEsq recently introduced Lawsuit Cost Financing (“LCF”), a line of credit that was specifically engineered to serve Plaintiff’s lawyers’ unique financial needs. LCF is best-in-class because of (1) its fast, automated “FinTech” underwriting capabilities; (2) competitive rates; (3) cashflow enhancing re-payment schedule; (4) no burdensome conditions; (5) superior customer portal that provides 24 hour online access to funds; and (6) the exclusive ability to include a Litigation Cost Protection policy with LCF, which is an insurance policy that pays the principal balance of your loan back in the event of a trial loss.
LCF is FAST. LevelEsq offers an efficient, automated application; and underwriting process that allows firms to access funds quickly and without hassle. Approvals and offers are provided in hours, rather than the weeks or months it takes many other lenders.
LCF is EASY. In addition to the streamlined application and approval process, LCF provides lawyers with access to an online portal offering tools to monitor and track interest as well as to manage the financial accounting related to their particular cases. The platform also allows firms to request additional funds online for cases as needed. Funds typically clear the next day.
LCF provides FLEXIBILITY. Firms can determine which cases to finance, the amount required for each case, and draw funds as needed. LCF’s repayment terms conform to the typical lifecycle of each case.
LCF has NO BURDENSOME CONDITIONS. LevelEsq does not require, for example, that firms end relationships with banks or other lenders, purchase life insurance for their benefit, or provide additional personal collateral.
LCF provides THE ONLY CASE COST INSURANCE. LevelEsq is the only lender that provides clients with an insurance benefit that pays off the principal balance of a cost loan in the event of a trial loss. If a firm or an attorney applies for LCF on a case within the first 120 days after service of process, LevelEsq will include a Litigation Cost Protection insurance policy with the loan. This unique insurance is only available from LevelEsq.
It’s time for you to Raise the Bar™ with LevelEsq.
To learn more, please visit www.levelesq.com.