Monday, February 13, 2006

Growing practice of plaintiffs lawyers taking out loans based on caseload value


The legal world's equivalent of home equity lenders, they make loans against a firm's caseload or against a trial verdict on appeal -- and they typically charge double-digit interest rates (or double-digit percentages of the attorney's contingency fees). "We advance cash against assets that are hard to get at," says Gary Chodes, the CEO of Oasis Legal Finance Group, a three-year-old company backed by a hedge fund that Chodes declines to name. Chodes says Oasis charges "north of 20 percent" interest, based on its risk and the length of the loan. "We're priced closer to venture capital than a bank loan."

North of 20 percent is on heck-of-a interest rate!

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