With this type of loan, you are essentially borrowing money against the settlement or judgment that you are expecting from the lawsuit you filed. Many victims of personal injury and similar cases apply for lawsuit loans because they don’t have money to pay for your large medical bills as a result of the injury they incurred. They also use the money to cover living expenses, loans and legal expenses.
The fact of the matter is that a lending company that specializes in settlement advance loans take a substantial risk every time they grant this type of loan to a plaintiff. As such, it will only lend you the money you need if it’s very confident that you have a good case. They will contact your lawyer and ask them as much information about your lawsuit, and the processing time may take a while as well.
Lawsuit advance lenders require applicants to have suffered personal injury, with approval from their lawyers. You also need to have a lien to your case, signed by you and your lawyer stating that you will pay them back once your case is settled or won.
It depends on several factors but generally speaking, it’s more expensive than other types of loans. But that’s mainly because this kind of loan carries high risks to the lender. That’s because a lawsuit could go either way and you, as the plaintiff (and borrower) do not have any obligation to the lender in case the settlement amount is lower than anticipated or if there’s no settlement at all. In addition, it takes a long time for a personal injury case to settle or go to trial. This is why the interest rates are much higher for such loans. It could go anywhere from 25-60% per year depending on which lawsuit cash advance provider you approach. So, the longer your case drags on, the more money you will be paying. In most cases, you will only pay if and when you win or settle your case.
Lawsuit loans are often considered the last option. Only when you have exhausted other means to obtain financing should you consider applying for this type of loan. Ask your family and friends if they can lend you money while you wait for your case to be settled or go to trial. You can also check with your credit union or bank if they can grant you a personal loan.
Going through a lawsuit can be difficult and expensive, and settlements can take a while, so what do you do in the meantime to pay the bills? Rather than end up in debt, you can just opt for a lawsuit loan as it’s more practical. If you’re not familiar with it, here are the pertinent facts.
Anyone who’s suffered an injury can verify that it will stress you out in different ways. First there is the litigation which can take a long time to resolve. As the days pass by, the legal expenses pile up, and the pressure on the litigant increases. If the injury is serious and you cannot work, you’re unable to earn to pay for the bills. What happens is the plaintiff has no option but to accept a deal, usually one sided in favor of the defendant. That doesn’t have to be the case, and with legal funding you can afford to go all the way.
Legal funding is different from the loans you get in financial institutions because the plaintiff (you) is not at risk. When you acquire the loan, you’re not obligated to pay for it unless you get a settlement or win the case. That’s right; a lawsuit loan only needs to be repaid if you receive a settlement, which will provide you with the necessary funds. If the court rules against you, there is no need to repay the lender.
Legal cases, particularly those involving personal injuries, can take a long time to resolve and can be a financial burden. Fortunately, lawsuit loans are now available to help you get by while your case is being settled. Because lawsuits are complicated, it can take up most of your time and money, but that doesn’t have to be the case.
The aforementioned loans are available from lawsuit funding companies, and there are a growing number of them. Basically what a loan does is provide you with the means to cover up for expenses you’re incurring. You’re under no obligation to use the loan in specific ways because it’s yours. You can use the loan any way you like and more importantly there are no up front charges that will be leveled at you.
When people talk about a loan they think of the kind that banks offer, where you’ll have to pay for it regardless of the outcome of your case. However that’s not how it works with legal funding. Legal funding providers are aware of the complexities involved in legal disputes, with time and money capable of crippling the plaintiff. With the latest studies showing that settlements can take up to a year, obtaining lawsuit loans is more practical.