There’s no denying that a divorce is a highly disruptive event in a person’s life. It represents the end of a way of living you have become familiar with, taking a heavy toll on your emotional and mental health.mIt can also pose significant damage to your finances, so much so that even moneyed divorcees can lose a significant portion of their current and future wealth.
More importantly, even if you have substantial savings tucked away in your accounts, these assets may be frozen throughout your divorce proceedings, leaving you with no way to pay for your divorce.
Financial Damage Intentionally Brought Upon by Spouses
But that’s not all. Some spouses who wield the financial power during the marriage intentionally cut off their ex’s access to credit cards, joint accounts, and other conjugal assets, hiring the most cunning of attorneys to put financial pressure on their former partners.
Some wealthy husbands and wives have been known to drag the divorce proceedings to a crawl, a tactic that intentionally drains their spouse of all funding. This forces the weaker party to surrender and agree to an unfair settlement that could have been avoided with enough resources.
Sure, you can borrow money from your friends and family, but not everyone has that option. Fortunately, situations like these are where divorce finance can do a lot of good.
What is Divorce Finance?
Divorce financing helps to even the playing field, giving spouses with little to no financial options the funding to pay for their attorney and other litigation fees. Financing also helps them maintain their quality of life.
Financiers can be reimbursed through a “contingency fee agreement,” which means they “win” if the client reaches a favorable decision or settlement. This contrasts with dealings with divorce lawyers, who can’t represent clients based on the outcome.
With independent financing, cash-strapped spouses can go after the settlements they think they deserve but would never have access to without the right resources.
Divorce financing is a relatively new product, with firms like New Chapter Capital and BBL Churchill among the few to offer loans and financing options specifically for individuals going through a divorce. These firms offer loans or advances to help clients pay for attorney fees and personal expenses, with repayment only required until reaching a settlement.
But how do these firms turn a profit? In theory, any divorce can lead to a favorable settlement if the litigant has enough resources at his disposal. Financiers know this, which is why they see your divorce as an investment opportunity. By investing in your divorce, the financier is making a calculated risk to get a solid return on their money.
Although no amount of money can completely ease the emotional and mental stress of a divorce, these kinds of products and services offer a solution to the financial burden of a separation, allowing litigants to devote their time to more pressing matters, like child custody and property division.
If you, or a loved one, are going through a divorce and need an appraisal of your finances and resources, schedule a consultation with family law attorney Daniella Lyttle to discuss your financial and legal options. Call the Lyttle Law Firm today to find out how we can help you.