There’s no shortage of lawsuits in Illinois. In fact, it has been hailed as one of the most litigious states in the country, that’s why you should always be ready in case you find yourself facing one.
Enlisting the help of a competent lawyer increases your chance to tilt the scales of justice in your favor. However, the inevitable costs of hiring a skilled and experienced professional are going to be high – but worth it.
Now, the crucial question: how can you get the money to afford one? That’s where we can help you. If you’re residing in Illinois and are having second thoughts about filing a lawsuit due to financial struggles, say no more.
With legal funding, you’ll be able to deal with the expenses of your lawsuit without having to go into debt. In this article, we’ll discuss what legal funding is, the essential information you need to know, the applicable laws in Illinois and how it can be beneficial to your situation.
Introduction to Illinois Legal Funding
If you’re unaware of what legal funding is, it is a form of cash advance that funding companies provide plaintiffs (those who were wronged or injured) to help them cover their expenses while pursuing a case. This can include legal costs, medical bills, daily expenses, tuition fees – whatever you need.
In Illinois, legal funding or pre-settlement funding is regulated under the Consumer Legal Funding Act and is classified as a loan. In order for funding companies to provide services and financial assistance to the state’s residents, they have to be licensed and operating under specific regulations.
The Legal Landscape: Understanding the Consumer Legal Funding Act
In May 2022, Illinois Governor J.B. Pritzker signed the Consumer Legal Funding Act into law. Generally, the law implements several new statutory provisions regulating numerous aspects of third-party litigation funding or consumer legal funding, including:
- Licensing and contractual requirements;
- Limits on consumer legal funding fees;
- Preclusions against funder control of litigation and settlement decisions;
- Prohibitions against certain activities such as lawyer and medical referral; and
- Provisions addressing attorney-client privilege and the work product doctrine.
What Is The Limit Of The ‘Aggregate Principal Amount’ For Legal Funding In Illinois?
The new law places a limit on the “aggregate principal amount,” stating that: “no licensee shall permit an obligor to owe the licensee, an agent of the licensee, or an affiliate of the licensee, including a corporation owned or managed by the licensee, an aggregate principal amount in excess of $100,000, unless permitted by rule, at any time for consumer legal fundings transacted pursuant to this Act.”
What Are The Rules On Legal Funding Fees In Illinois?
It also places limits on the fees that a consumer legal funding company can charge its clients. It said that the fee “shall be calculated as not more than 18% of the funded amount, assessed on the outset of every 6 months.”
Moreover, it said that “no charges may accrue on a consumer legal funding for more than 42 months after the funding date of the consumer legal funding. No consumer legal funding may be refinanced except as authorized by rule. Notwithstanding the foregoing, a consumer legal funding company may assess charges on any additional amounts provided after the funding date for 42 months after the additional funding date.”
Why Illinois Residents Choose Legal Funding
Cases in Illinois can take up to months and sometimes even years before it reaches a settlement. So, if your case continues to go on, the expenses will most probably also get higher.
This unfortunate reality pushes most people to settle for a lower amount rather than what they truly deserve, but with legal funding, you don’t have to
By choosing legal funding, plaintiffs will be able to manage the finances associated with their lawsuit as well as their daily necessities or any other expenses that may arise as the case continues without having to go through the money in their pockets.
Licensing and Regulatory Framework in Illinois
Before any legal funding company can provide its services to consumers, the new law requires a funder to first obtain a license.
A potential legal funding provider must file an application for a license with the Secretary of Financial and Professional Regulation or Nationwide Multistate Licensing System and Registry.
Applicants are also required to prove to the Secretary in a form satisfactory that they have and will continue to maintain a positive net worth of a minimum of $30,000.
Moreover, the new law also requires that all issued licenses should be renewed every year using the common renewal date of the Nationwide Multistate Licensing System and Registry, as required by the Secretary.
Contractual Stipulations and Requirements
The contract between a client and a funder should contain certain disclosures and information, including an acknowledgment by an attorney.
The law requires that the contract must be completely filled in with no blanks and be prepared using a specific type. The agreement must also state “a right of rescission, allowing the consumer to cancel the contract without penalty of further obligation, within 14 business days after the funding date” and includes detailed instructions for the consumer to follow to effectuate rescission.”
It must also have certain disclosures. This includes, in clear language:
- The funded amount to be paid to the consumer or on the consumer’s behalf by the consumer legal funding company;
- An itemization of charges;
- The maximum total amount to be paid by the consumer to the company, including the funded amount and all fees; and
- A payment schedule to include the resolution amount, listing dates, and the amount due at the end of each 6–month period from the funding date, until the date the maximum amount is due to the company by the consumer to satisfy the amount due pursuant to the contract.
The contract must also contain information regarding the consumer’s right of cancellation and include specific language advising the consumer, in part, that “before you sign this contract, you should obtain the advice of an attorney.”
It also states the consumer litigation funding company “shall provide the consumer with information on accessing a financial coaching program no later than the funding date.”
The consumer’s attorney should also attest to the following:
- To the best of the attorney’s knowledge, all the costs and charges relating to the consumer legal funding have been disclosed to the consumer;
- The attorney is being paid on a contingency basis pursuant to a written fee agreement;
- All proceeds of the legal claim will be disbursed via either the trust account of the attorney or a settlement fund established to receive the proceeds of the legal claim on behalf of the consumer;
- The attorney is following the written instructions of the consumer with regard to the legal funding; and
- The attorney has not received a referral fee or other consideration from the consumer legal funding company in connection with the consumer legal funding, nor will the attorney receive such fee or other consideration in the future.
The contract shall be “null and void” if the above-stated requirements aren’t fulfilled.
Application Process for Lawsuit Loans at Tribeca
Submit An Application
For the application process, you will only have to provide us with all the essential details associated with your lawsuit. Also, you need to have legal representation.
Our form will not ask you to provide any information related to your financial status or credit history, nor will we require you to pay any upfront fees or down payments.
Once you have submitted your application form, our team will immediately review the details of your case. We will evaluate your eligibility depending on certain factors, such as the type of your lawsuit and how much money you will need, as well as the likelihood of your case to succeed.
When we’ve confirmed that you’re qualified, we will send you an offer, along with the terms and conditions of the agreement. If you choose to accept the offer, we will send you the funds as quickly as possible, within 24 hours.
Benefits of Choosing Tribeca for Your Lawsuit Loan Needs
For years, we have provided financial assistance to the residents of Illinois. Listed below are several key advantages to choosing Tribeca for your needs:
- We strictly follow the state’s rules and regulations regarding legal funding;
- You can expect full transparency;
- We offer funding for a variety of cases;
- We do not charge any upfront fees or monthly charges;
- There are also no hidden fees;
- We offer competitive rates.
- We have a compassionate and diligent team.
Frequently Asked Questions about Illinois Legal Funding
Do I Need To Repay You Back If I Lose My Case?
Absolutely not, and that’s the best thing about legal funding. Unlike traditional loans, legal funding is non-recourse.
This means that you are not obligated to repay the funding if you do not win or settle the case in your favor. We are bound to the judgment, and we will not come after any of your properties. That’s the Tribeca guarantee.
What Is The Civil Lawsuit Process Like In Illinois?
Here in Illinois, the process of a civil lawsuit starts when the plaintiff (the person injured or aggrieved by another) files a complaint in court and serves it to the defendant (the one responsible).
Once the defendant is notified, they will then submit an answer to your complaint or a motion to dismiss. After this, settlement negotiations may take place, or if necessary, the case will go to trial.
The court will then hear your respective claims and decide on the strength of your arguments and evidence. When a judgment is reached, either party can appeal.
Start Your Illinois Legal Funding Journey with Tribeca
Here at Tribeca, we strive to provide our clients with high-quality service and dedicated professionals to handle your case. We believe that no amount of money should hinder individuals in pursuing litigation.
That is why we provide legal funding to help individuals in Illinois fight for their rights as they seek the settlement they deserve. Fill out our secure and confidential form today or call (866) 388-2288 now.