Many times, people injured in a car accident in Maryland need immediate money in order to pay bills, feed their family and/or to keep their car from being repossessed or their home from being foreclosed upon. Although ethical rules prohibit Maryland lawyers from making loans or advances to their clients, there are companies out there that will, in selective cases, advance a small amount of money to a client in exchange for a security interest in the client’s case. Unfortunately, most of these companies charge an exorbitant rate of interest and sometimes additional fees that make such advances a very bad deal for the already financially devastated client.
As a lawyer, I always discourage my clients from taking these loans/advances and tell them that they are much better off borrowing money from friends, family or perhaps their church. But sometimes, the client has no option and obtaining the advance is an absolute necessity. It is important to choose which litigation funding company you are going to work with carefully as the fees and rates of interest vary.
The Maryland Department of Financial Regulation has recently ruled that one company making these advances- American Legal Funding, LLC – is doing so unlawfully and has taken advantage of Maryland accident victims. The Department issued a “Cease and Desist” order against them. The order requires that American Legal Funding CEASE AND DESIST from collecting or attempting to collect on any such advances or loans made to Maryland consumers. The interest and fees charged by American Legal Funding was found to be in violation of Maryland law and the Maryland Declaration of Rights.
If you have received a loan or advance on your car accident or personal injury case in Maryland, and if you think that you were treated unfairly or charged excessive fees or excessive rate of interest please feel free to call a Silver Spring injury attorney from Goldberg Finnegan, LLC to discuss the situation and what your options are. We can be reached at (888) 213-8140. More importantly, if you or someone you know received a litigation advance from American Legal Funding, LLC call us to discuss the situation.