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Best Practices

5 No Brainer Application Disqualifiers

May 7, 2018
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5min read

Need an easy to implement tactic to improve your entire application process? Look no further!

A sure-fire way to focus more time, energy, and effort on high-potential applications, raise team morale, and improve your bottom line is by explicitly defining criteria that automatically disqualify an application from being considered for financing.

Whether you do medical funding, plaintiff funding, or both, your decision as to what sorts of cases to not spend time on is as crucial as identifying the winners.

The first step is to get your list of “automatic disqualifiers” in place by asking yourself, “What application characteristics will we never consider?” A great way to do this is to review the data on your last 30 rejected applications for consistent themes.

Once you’ve defined your criteria, you’ll need to make sure that list of front-and-center with your team throughout the entire funding process and that those disqualifiers are continuously sought-out at each stage.

To help get you started, this post covers 5 no-brainer disqualifiers:

  • The plaintiff not represented/does not have an attorney.
  • The plaintiff is a minor.
  • Unfavorable jurisdiction
  • Case types outside your investment thesis
  • Soft tissue, prior plaintiff funding

The plaintiff does not have an attorney

Often, when funders are contacted by a plaintiff without representation they will automatically consider the application disqualified.

More likely than not these people are often simply looking for a personal loan, googled something general like “cash advance,” and clicked your ad, but don’t understand what service you really provide do. This could also include pro se plaintiffs, which should also raise the alarms for you. Many funders even consider plaintiffs “in conversation” or close to signing a retainer with an attorney to be unqualified.

The plaintiff is a minor

Another easy case-feature to look out for from the is whether the plaintiff is a minor. Without getting into the legal and ethical nuances, at a high-level many funders consider these cases disqualified due to the fact that if the case is successful, the funds are typically unavailable until after the plaintiff’s 18th birthday (at the earliest).

Here are a few resources to learn more:

What Happens When a Minor Settles a Lawsuit?

Personal Injury Cases Involving Children

Whether or not your potential client is found out by simply asking for the plaintiffs’ date of birth on the initial intake call, and being sure to get a photo of their ID before disbursing funds.

The only wrinkle is if there is a consortium claim. This refers to the loss of benefits and/or damages incurred by family as a result of the plaintiff’s  injuries and can include damages for loss of services, loss of financial support, and loss of the relationship. These cases are relatively uncommon, so when you hear from a potential client that they think they might have a consortium claim, be sure to make that your first question to the attorney before moving forward.

Unfavorable jurisdiction

As you know, jurisdiction matters, and providing your team a clear list or map of states for which you have compliant contracts and are able to fund is incredibly important. Always take note of the originating state for the claim, as well as the plaintiff’s state of residence, before moving forward with a case.

Even if a state is funder-friendly, its laws may have limits on maximum rates and/or recovery amounts for legal funders (most notably in states with tough usury laws where funding is considered a loan). Make sure your expected settlement amount makes sense in that state.

Case types outside your investment thesis

In the broad world of torts, medical and plaintiff funding companies typically only consider a sliver of potential case-types. Creating a list of case-types outside of your investment thesis makes it easy for your team to remove these applications from your queue from the get-go.

Potential examples of cases many funders exclude from their portfolios: Social Security/SSI/Disability; criminal defense; Family court/custody; inheritance/probate claims where the potential reward (legal relief) is most likely real estate or physical property and not money (damages); low-value divorces.

Soft tissue injury and prior plaintiff funding (sometimes*)

If a client has only soft tissue injuries (e.g. sprains, strains, bruising, bulging discs) and related treatment (e.g. physical therapy, chiropractor work, injections not requiring anesthesia) AND prior plaintiff funding (typically less than or equal to $1000) he or she is probably unqualified.

Why? Typically round of plaintiff financing is all the case can support.

If the plaintiff is expecting or has received epidural injections, nerve blocks, rhizotomy, herniated discs, etc., however, it may be worth investigating

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