According to an industry expert, one of the main reasons young legal funding businesses fail is poor or non-existent case servicing. What these ill-fated businesses don't know is that, after a plaintiff is funded, the next and most crucial, time-consuming part of running a funding company is case tracking. By monitoring your investments between the time of funding and settlement, funders ensure investment security and are able to anticipate returns to plan future investments.
In this post, you will learn the 6 primary steps to case tracking to help you either build your case tracking process or improve the case-tracking machine you already have in place.
We previously wrote about this topic and stand by what we said:
In short, whether by phone, email, or certified mail, you need written (ideally) or verbal validation of your lien by a law office employee.
Check out the above post for more details on why confirming your liens is the first, and potentially most crucial step in protecting your investments and maximizing your returns, as well as actionable tips and templates on how to do it effectively.
During your initial call, locate the contact person for the remainder of the case. This may be different than the paralegal you worked with to fund the plaintiff.
Depending on the size of the law firm and attorney caseload, the contact person could be anyone from the lawyer or paralegal to the lien, or a dedicated funding manager, who manages updates to pre-settlement plaintiff funders for the entire firm.
There is no one-size fits all answer when searching for the contact, so it's critical to use your judgment and find him or her early in the process.
The timeline for tracking follow-up will vary case-by-case, but case updates should be received every 60 to 180 days depending on a variety of factors, such as case type, the age of lien, jurisdiction, and case status, among others.
"Contact" should happen through email correspondence or a phone call. Email is typically better, as you then have the conversations in writing, which could be valuable if the case runs into issues later on.
At each point of contact, ensure you note the following information in your software system's case tracking update function:
Your goal over the course of this correspondence is threefold: 1) remind the law firm you have a lien on their case(s) 2) confirm the attorney is still representing the client 3) anticipate the timeline for settlement, which is especially important for funders who report to outside investors or capital providers. Having accurate and up-to-date case statuses is crucial for credibility and trust.
If you have multiple cases with one law firm, send update requests in batches. It saves everyone time in the end.
One crucial reminder here is to never give payoff amounts over the phone. If you receive a case-update over the phone and the paralegal or attorney asks for a payoff, get his/her email address and follow-up your call with an online correspondence containing the payoff letter.
If during one of your routine check-in calls you learn that a particular case has the demand filed, is in-suit, received a settlement offer, or reached another stage indicating a resolution of any sort, it is now time to flag that investment.
In these instances, the case may warrant a two-week check-in period, as you should be expecting to receive your return in relatively short order.
Examples of case statuses include:
In between phone/email check-ins, many funders also use lien statements to stay top-of-mind with their law firms.
Often, these statements are lists of plaintiffs at the law firm who have received funding, reports on the date they were funded and the current payoff amount.
Some funders view lien statements as an essential tool in their case-servicing tool box. Others take the position that they are only excess paperwork that gets ignored and can be confusing.
These services are only useful for cases in-suit; for such cases, however, they are indeed invaluable when it comes to understanding the status of a case without calling/emailing the attorney's office.
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