Settlement Funding Frequently Asked Questions
Strategic Finance for Law Firms
- Why would I use Settlement Funding?
- What does it cost my firm to use Settlement Funding?
- What does it cost my client to use Settlement Funding?
- How much will you advance on my settled case?
- Can I use Settlement Funding for class action/mass tort cases?
- Is there an application fee or a collateral inspection fee?
- Are there any legal fees?
- Are there any audit or field exam fees?
- Are there any pre-payment penalties?
- Do you check my credit?
- Is there a renewal fee?
- What can the funds from ACI's Settlement Funding product be used for?
- How is interest calculated and billed?
- How long does it take to get approved?
- When does the principal need to be paid back?
- How often can funding requests be made on a Settlement Funding transaction?
- Is there a minimum amount that qualifies for Settlement Funding?
- Is there a maximum amount that can be advanced on a settlement?
- What is the collateral for a Settlement Funding transaction?
- Does your Settlement Funding product require personal guarantees?
- Does your Settlement Funding product require on site audits of the law firm?
- Are there any monthly payments to make?
Why would I use Settlement Funding?
Speed. Our Settlement Funding product can be approved and funded in just a few days. It enables you to accelerate your future fees so that you can put them to work on other projects immediately.
What does it cost my firm to use Settlement Funding?
When we purchase your future fees using our Settlement Funding product, we deduct a small fee that depends upon how long it takes us to receive the total fees upon disbursement. For a specific case, please check with one of our financial advisors for current pricing by calling toll-free 1.877.894.9724.
What does it cost my client to use Settlement Funding?
Nothing. All fees paid to ACI result from a discount to the purchase price paid for the future law firm fees. All the cost is borne by the law firm.
How much will you advance on my settled case?
We can purchase up to 50% of the total expected fees and expenses due to your firm on any one settled case.
Can I use Settlement Funding for class action/mass tort cases?
No.
Is there an application fee or a collateral inspection fee?
If your advance is less than $150,000, there is a $150 processing fee. If the advance is greater than $150,000, that processing fee is waived.
As long as the transaction is not in default, no.
Are there any audit or field exam fees?
As long as the transaction is not in default, no.
Are there any pre-payment penalties?
No.
Yes, but the actual credit score does not matter very much for Settlement Funding. We use the credit report mainly to look for potential outstanding judgments or federal tax liens on the firm or its owners that could cause problems.
Our Settlement Funding product is a one-time purchase of future fees, not a line of credit or a loan. So a renewal fee is not applicable.
What can the funds from ACI’s Settlement Funding product be used for?
The funds from ACI’s Settlement Funding product can be used for any commercial purpose at a law firm. This includes, but is not limited to, case expenses, advertising, payroll, equipment, rent, tax payments, partner distributions, etc.
How is interest calculated and billed?
There is no interest involved in our Settlement Funding product, therefore there are not monthly interest charges or payments. There is a discount applied to the purchase price paid for the future fees that varies depending upon the length of time required for the fee to be collected. All of the fees paid to ACI come from the ultimate settlement.
How long does it take to get approved?
The approval process normally takes 1 to 2 business days once all necessary documentation has been received at the ACI offices.
When does the principal need to be paid back?
Because our Settlement Funding product is not a loan, there is no principal. ACI purchases future fees at a discount and collects the fees once the final disbursement is made by the defendant in your case.
How often can funding requests be made on a Settlement Funding transaction?
Settlement Funding is a one-time transaction.
Is there a minimum amount that qualifies for Settlement Funding?
The minimum advance is $50,000.
Is there a maximum amount that can be advanced on a settlement?
The maximum advance on any one settlement is $500,000.
What is the collateral for a Settlement Funding transaction?
The collateral is the fees and reimbursable expenses due to the firm on the case that has been settled.
Does your Settlement Funding product require personal guarantees?
No. You will be required to guarantee that you will abide by the terms of the sale agreement, but you will not be required to guarantee payment by the defendant.
Does your Settlement Funding product require on site audits of the law firm?
No.
Are there any monthly payments to make?
No. All monies paid to ACI come from the disbursements paid by the defense.
