Updated on 6/9/2021
This article helps plaintiffs and attorneys alike learn more about lawsuit loans in North Carolina. Below you will find the following information:
Lawsuit funding laws, regulation and relevant ethics opinions in North Carolina
North Carolina treats lawsuit funding as a loan, subject to state lending laws.
Laws regarding lawsuit loans in North Carolina
North Carolina treats pre-settlement lawsuit funding as a loan and typical lending provisions apply as set forth in G.S. 24-1.1A. North Carolina sets the interest rate for loans of less than $25,000 as the minimum of 16% and the 6 Month Treasury Rate plus 6%. As a result, many lawsuit loan companies only advance amounts in excess of $25,000 to avoid these laws.
Source: North Carolina’s G.S. 24-1.1A
Legal funding case law in North Carolina
In Oliver v. Bynum the court ruled that an agreement to finance the suit was champertous based on the grounds that it served to stir-up litigation. Lawsuit loan agreements that are not construed to stir-up or intermeddle with litigation would likely be upheld in NC.
Source: Oliver v. Bynum
Can a lawyer lend money to a client in North Carolina?
North Carolina attorneys may not provide financial assistance to plaintiffs they represent. They may, however, finance court costs and other costs of litigation.
Source: North Carolina Rules of Professional Conduct Rule 1.8(e)
Can attorneys help clients receive lawsuit loans in North Carolina?
The state bar of North Carolina has ruled that a lawyer may cooperate with lawsuit lending companies in connection with a client’s request for funding. Attorneys may: sign off on acknowledgment letters; make payments to the pre-settlement funding company; refer clients to a funding company; and disclose confidential information to the company with the client’s consent.
Source: North Carolina State Bar 2000 Formal Ethics Opinion #4: Acknowledging a Finance Company’s Interest in a Client’s Recovery
Lawsuit loan companies serving North Carolina
Recommended lawsuit loan companies funding North Carolina residents
US Claims offers some of the lowest, non-compounding rates in the industry. Many companies claim to offer “the lowest rates in the industry” – we recommend comparing them against an offer from US Claims. to see for yourself.
Thrivest Link Legal Funding offers fair terms with a fast, efficient funding process. Many companies claim to offer same-day or 24-hour lawsuit loans but Thrivest Link Legal Funding often actually makes it happen.