Workers’ Compensation Attorney Loans Not Allowed
Workers’ Compensation Attorney Loans – Not Allowed
I get calls from potential clients asking about workers’ compensation attorney loans for their settlements. It is illegal for any Georgia workers’ compensation attorney to loan money to a client for a future settlement. It is explicitly outlined in Georgia State Board of Workers’ Compensation Board Rule in Rule 15K where it states that no party or any party’s attorney shall enter into a loan or assignment with a third‑party creditor which requires repayment from the proceeds of a workers’ compensation claim. Very often, clients are in a difficult financial position. However, you may see a commercial or hear about something from a friend regarding settlement advances or loans. This may seem like a great idea since they are offering to you money right away. The activity is called a Advanced Settlement Funding, and some law firms are allowed to leverage this service, but workers’ compensation claimants are not allowed to receive these loans. It is further outlined in the rule book under Rule 84.
“No party to a claim or any party’s attorney shall assist, secure, create, or execute any loan or assignment with a third party creditor which requires repayment out of any recovery, settlement, or payment of benefits from any claim filed under this chapter.” [Source: Georgia State Board of Workers’ Compensation Board Rules]
Georgia Workers’ Compensation Attorney You Can Trust
Gearhart Law Group will not sign loan papers. We think you should know this up front. While we are extremely sympathetic to the plight of the injured worker, there is an explicit board rule prohibiting this practice. Many people disagree and think that this is not enforceable, however, even if it was enforceable, settlement loans come with their own risk.
Settlement Loan Risks
Workers’ compensation attorney loans have many risks. First, settlement loans create a conflict of interest between the lawyer, client, and the funding company. Second, the fees are very high, so you could end up owing more than you receive once the interest is factored into the equation. In many cases, claimants see the interest accruing and opt to resolve their claim more quickly than it should be settled. Finally, any lack of payment will create further litigation between the attorney and the injured worker. This creates the ultimate conflict between a client and attorney.
In summary, settlement advances from outside companies arrive with pitfalls. While it’s frustrating, we simply cannot guarantee those loans for anyone at Gearhart Law Group. Furthermore, we would strongly advise against using any attorney who is offering to broker an agreement with a loan settlement funding company.
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Georgia Workers’ Compensation Attorney
Beth Gearhart is an ethical and trustworthy Georgia workers’ compensation attorney. She will fight for your rights and maximize your case settlement value. When researching workers’ compensation attorneys in Atlanta or the state of Georgia, please focus on attorney Google Reviews. Only trust your workers’ compensation settlement with the most trustworthy and honest attorney. Call Beth Gearhart at (404) 445-8370 to learn your options today!