There is a mismatch between the structure of litigation and traditional lending criteria, meaning law firms often struggle to secure the funding they need through traditional channels. Banks are not set up to lend against the future proceeds of legal cases, particularly when those cases have uncertain timelines.
Litigation finance fills that gap. Funders like Fenchurch Legal provide flexible, fast funding solutions that align with the structure and cash flow needs of legal claims. The rates Fenchurch Legal charges reflect this speed, and the specialist expertise involved — something traditional lenders simply don’t offer.
These funding solutions are specifically designed for law firms, unlike traditional loans, which tend to have rigid terms and slow approval processes.
While After-The-Event (ATE) insurance helps reduce downside risk, it doesn’t change the fact that law firms need flexible, case-aligned finance. And there's still the complexity involved for a funder in assessing cases and monitoring performance, which is why litigation finance requires specialist expertise.
Fenchurch Legal offers tailored facilities. Once a law firm has a facility in place, firms can draw down funds as needed to support new cases. Interest is only paid for the time the funds are used, so if a case settles early, the loan can be repaid, and the funds can be drawn down again on future cases. This provides an efficient, revolving source of funding.
Why would a law firm choose private credit and not borrow from a bank at a lower rate?
Joe