Law firms today are seeking financing solutions to help them start, develop and grow their business as well as support their clients. Just like every other business, legal firms require financial support to grow and move forward. Unfortunately for them, it is not possible to guarantee normal loans because in most cases their finances are tied up in their cases, with no surety that the cases will award eventually. Banks and other financial institutions are not fully equipped to evaluate the risk attorneys pose in getting loans, which is why a special form of financing is necessary for legal firms.
Here are five law firm financing strategies that every attorney should know:
1. Working capital for attorneys
Proper financing will make any law firm a successful legal profession. Good thing is that there are companies willing to offer a flexible litigation funding to attorneys to help them cater for their operating expenses. This law firm financing strategy is a perfect solution to the funding problem that attorneys are facing today. Unlike banks and other lenders, loan lenders offering working capital will charge the loan fairly and speed up the application process for you.
2. Merchant Cash Advance
This is the kind of financing legal firms accepting payments through credit cards can access. It is a fast and easy business funding solution for a company that needs some working capital to facilitate its operation. Fortunately, a business can get a loan of up to $250,000 in cash deposit and is issued out within 24 hours of application. This is a perfect way to boost a legal firm business. This kind of financing is usually based on future sales. An attorney can automate payback to make it easy to clear the debt on time.
3. Small Business Loan
This is basically a short-term business funding solution that can work very well for any legal firm. An attorney applying for this loan can get up to $250,000 in cash. The lender, in this case, does not consider the kinds of assets you have, or whether or not the attorney has a good credit score. What is important in the issuance of this loan is the performance of your business, its cash flow and its potential for growth.
4. 3 Stip Business Cash Advance
A well-established business can easily qualify for this kind of law firm financing. Up to $30,000 in cash can be advanced, with only a driver’s license, a voided check, and bank account verification through screen share or decision logic. If an attorney has been in the business for more than 2 years, this is a good funding strategy to go for. There should, however, be nothing negative about the business or its principals out there.
5. Split funding
This is the ideal financing solution for a legal firm that is seasonal or one with fluctuating sales. The non-fixed daily or weekly repayment that is usually based on the percentage of credit volume works very well with such kinds of businesses. The good thing about this kind of funding is that it requires minimal effort on the part of the business owner.
Financing of law firms is a complicated affair that requires a specialized financier who deals with special kinds of loans for such businesses. Good thing is that attorneys have plenty of options when it comes to financing their law firms.