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Neosho, MO, United States, 2006/03/04 - Are Attorney & Plaintiffs 'No risk lawsuit loans' usury? A new trend in litigation has more than its share of controversy in the arena of non recourse lawsuit funding - 1stChoiceFunding.com.
In light of a recent new trend in litigation opponents and proponents have entered a gridlock in the arena of non recourse lawsuit funding. Despite the fact that legal professionals readily admit no two cases are alike and that there is never a 100% guarantee of success on any given case, "No Risk" lawsuit funding has found itself amidst controversy.
When “No Risk Lawsuit Loans” from firms such as 1st Choice Funding promote the opportunity to obtain "risk free" cash “Pandoras Box” suddenly open when this form of capital is compared to traditional lending interest. Yet "Lawsuit Loans" as consumers refer to them as deliver far more lenient terms than any government regulated lender could legally ever offer. Ask yourself “when last was I offered money on these terms”
• You don’t need credit to receive a loan;
• You don’t need collateral to receive a loan;
• You don’t need employment to receive a loan;
• You don’t need to make any payments ever to receive a loan;
• You don’t need to prove you have the ability to repay to receive a loan, and the only thing we ask in return is that “if or when” you win your lawsuit you repay us…ok?
Now as absurd as this seems, this is exactly what a “No Win…No Pay…No Risk” Lawsuit Loan, or really venture capital investments” from 1st Choice Funding offers" says company president Timothy. S. Gray. Thus when hastily comparing ‘no risk funding” to “low interest bank loans” Gray continues, "doesn't it appear we are really comparing "apples & oranges?" As with any financial decision the choice is clearly up to you, if you don't like the cost of return for a no risk investment and feel lower interest is worth 100% risk and ongoing payments, then traditional lending is your best option. However for an increasing number of plaintiffs and their attorney’s who have weighed the advantages and have become informed, paying higher interest with “no win-no-pay-no risk and no-monthly-payments” has increasingly become the preferred option. Why attorneys who utilize the cash option and thier clients seek such if these were cloaked loan sharks?
Now when a professional financial consulting firm specializing in Plaintiff and Attorney Funding offers this type of service aren't they providing a “mixed signal?”
The firms motto clearly defines it’s agenda located at the comapny's website, it states "Protecting Your Interest from Interest?"
How then does 1st Choice Funding support an industry whose services have been labeled “usury because of the interest?”1st Choice Funding's COO Ellen Sampson provided this simple answer when she said “we only represent investment firms whose recovery rates are not "excessive."
That being said then the question remains "what is excessive?" And this is where the issue heats up. 1st Choice Funding’s management staff offered this perspective, “we find it ironic that those who use words like "usury" have shown a different color when we have asked them if it was your investment money what would your rate of return be for this type of risk?
This issue has been made clear on “too numerous to count instances” and it is at this defining moment when the “shoe now being on the other foot, suddenly begins to fit a lot better and the rates that were moments earleir "excessive or usury" no longer at least for the moment appear to be such.