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We Build Strong Business Relationships with Attorneys
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FairWorth specializes in providing non-recourse cash advances for plaintiffs’ living expenses and litigation costs. For those who are new to non-recourse advances, if the plaintiff does not recover money on their case, they owe us nothing.
Over 90% of our advances are referred by attorneys. Over 75% of our advances are with attorneys who have worked with us before. Attorneys refer to FairWorth because we provide price leadership and service leadership. You’ll like the way we do business.
To the client, FairWorth offers prices among the lowest in the litigation-funding industry, undercutting many competitors by 20 to 50%.
From the attorney’s perspective, our service leadership may be more important than our price leadership. Our business practices avoid two pitfalls that cause attorneys to dislike client advances: advancing too much money, so that it interferes with fair settlement; and being unwilling to reduce fees when the settlement is less than was expected. And we have streamlined our ability to approve and fund an advance very quickly, with the least possible imposition on you and your staff.
The links below will take you to the subjects that interest you.
What Is a Non-Recourse Cash Advance?
Benefits to You and Your Client.
Cost of the Advance.
When to Use Cash Advances.
Our Policies Avoid the Typical Pitfalls of Cash Advances.
Our Simple Application Procedure.
Our Hands-Off Approach.
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What Is a Non-Recourse Cash Advance?
Non-recourse cash advances to plaintiffs in lawsuits have been around for several years, but some experienced attorneys are not familiar with how they work or how the client and attorney benefit. A non-recourse cash advance is a sum of money advanced to a plaintiff in a lawsuit. The money is advanced against the plaintiff’s share of the recovery from the lawsuit. No one is responsible to repay the sum advanced if there is no money recovered on the lawsuit. If the lawsuit is successful, the amount of the advance as well as the fees for the advance are deducted from the plaintiff’s share of the recovery, and you keep your entire legal fee. To secure the advance, the client grants a priority lien against their monetary recovery. Non-recourse cash advances are available only if you are providing legal services under a contingency-fee arrangement.
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Benefits to You and Your Client.
Non-recourse cash advances are sought for the following reasons: (1) to fund your client’s living expenses so that they are able to wait for an optimal resolution of the lawsuit; (2) to pay for your client’s medical treatment that cannot be obtained on a lien basis, typically surgery; and (3) to maximize the value of the case by enabling you to hire expert witnesses or other consultants, conduct discovery, etc. The benefits to you and your client are clear. Moreover, if your client needs a cash advance, your office avoids having to make the advance, which means: (1) you don’t have to contend with the State Bar Association, which frowns on—or may even prohibit—client advances; (2) your firm’s cash flow is free for other uses; and (3) your money is not tied up in a non-income-earning activity.
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Cost of the Advance.
FairWorth’s rates are among the lowest in the litigation-funding industry. We undercut many competitors by 20 to 50%. Unlike many firms, FairWorth does not charge by the year, half-year, or calendar quarter, which can result in very high monthly rates, nor do we charge sales commissions of any kind.
We caution you that the rates you see advertised can be very misleading. If you’re rate-shopping for your client, ask for a payoff schedule for months 3 through 15. Call us to compare, and you will find that we are generally less costly.
Nonetheless, the fees for non-recourse advances are rather expensive, because your client has no personal liability to repay the money unless there is a recovery on the case. It’s a lot like a contingency fee, and as you know, there is always material risk in the outcome of litigation.
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When to Use Cash Advances.
Cash advances are not appropriate for all cases. For that reason, FairWorth prefers to work through attorneys, and not to advertise directly to the general public. We want you to select the cases that are appropriate for an advance: cases in which the client’s need is severe and the amount of money they are seeking is small relative to the value of the case. Please put us in your resource file for those periodic occasions.
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Our Policies Avoid the Typical Pitfalls of Cash Advances.
Some attorneys are concerned that if their client takes an advance, it will create a future problem for the attorney. In our experience, problems arise when: (1) the amount of money advanced is too large, causing the client to lose incentive to settle the case; or (2) the funding company is inflexible if the settlement is disappointing.
FairWorth carefully tailors the size of each advance to the value of that respective case. We never want the client to owe us too high a percentage of what they will put in their pocket at the end of the case. To arrive at the amount that we can advance, we apply conservative estimates of: (1) the settlement value on the case; (2) when it will settle; and (3) what liens and bills besides our lien must be paid out of the settlement.
Despite our conservatism and careful calculations, a case sometimes settles for materially less than what you or we expect. That’s just the way of the world in litigation. In those instances, we are flexible and reduce our fees, so you can get the case resolved and behind you. FairWorth is looking for long-term relationships with our attorney clients.
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Our Simple Application Procedure.
FairWorth does not use a standard application form that asks needless questions. We can generally give you a tentative yes or no after a three-minute explanation of the case by you or your paralegal. We ask you to send only the paperwork that we really need to confirm the yes. We promptly fax you back an advance contract; then, we can wire transfer money when the signed contract is faxed back to us. Often, the client has the money within 24 hours after the initial contact.
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Our Hands-Off Approach.
FairWorth does not interfere in any way with the case or your relationship with your client. You control strategy, expenditures, settlement, and trial.
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