Legal Fee Financing: What Is It and How to Offer It
What if you could receive your total fee upfront at the beginning of an engagement while still allowing your clients to pay in installments? It sounds too good to be true, doesn’t it? With legal fee financing, not only is it possible, you can start taking advantage of this modern payment option today.
What is legal fee financing?
Fee financing (also known as fee funding) is an installment loan option that enables customers to purchase products or services while paying for them in smaller increments over time. By establishing a direct relationship with the merchant, the consumer can avoid using credit cards to cover the cost of the purchase, and eliminate the associated fees and interest charges.
Legal fee financing is one of several alternative payment methods offered through law firms. By easing the burden of large, one-time bills, law firms can make legal services more accessible to those who need them most.
Why should law firms offer options for legal fee financing?
In addition to expanding your available payment options and making your law firm more attractive to prospective clients, fee funding improves the consistency and reliability of your cash flow.
Lawyers often hesitate to let clients pay over time because traditional payment plans can have a higher incidence of late and non-payments. Offering financing for legal fees helps mitigate the risk of both.
Your firm receives the total requested amount upfront, and clients can split an invoice into multiple payments. If a client falls behind on installment loan payments or refuses to pay, your law firm is typically not responsible.
Manage your law firm’s financing options
Adopting an online payment solution enables you to offer flexible payment options such as credit, debit, eCheck, and in some cases, legal fee financing. The result is a stabilized cash flow, happier clients, and more time to focus on work that matters to you.
Beyond the benefits listed above, the advantages of fee funding ultimately serve both you and your clients. Your client gets help with legal fees and knows precisely how much they will owe with a set number of smaller payments scheduled over an established time frame. This is an increasingly attractive option for consumers during growing economic uncertainty.
To learn more about LawPay, ClientCredit (a fee lending solution built by LawPay specifically for the legal industry, powered by Affirm), and our commitment to supporting your firm’s success, visit https://www.lawpay.com/member-programs/aba-advantage/.
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