Running a law firm can be an incredibly rewarding career, but it's not without its challenges, particularly when it comes to securing funding. Traditional loans can be difficult to obtain, and many lawyers can't or don't want to rely on personal savings to finance their practices. That's where attorney funding comes in.

What is Attorney Funding?

Attorney funding is a type of financing that enables lawyers to receive upfront cash in exchange for a portion of their future fees. This can be particularly useful for attorneys who work on contingency or settlement-based cases, as they may not receive payment until the case is resolved. By obtaining funding, these attorneys can cover their operating expenses while they wait for settlements or court rulings to come through.

The Advantages of Attorney Funding

Unlike traditional loans, attorney funding is not based on a lawyer's credit history or financial position. Instead, lenders evaluate the potential value of the lawyer's cases and offer funding based on that assessment. This makes it easier for attorneys to obtain the capital they need, even if they have poor credit or are just starting their practices.

The Types of Attorney Funding

Attorney funding is typically structured as a non-recourse loan, which means that the lender assumes the risk of non-payment. If a funded case doesn't result in a settlement or verdict, the lawyer is not on the hook for repayment. This can be a major advantage over other types of financing, which may require full repayment regardless of the outcome of the case.