However, lawsuit settlement cases can take anywhere from weeks up to years to end. Along this period, the health provider might come knocking with a medical lien, or the car repairs debts accrue to unimaginable figures.
Luckily, there are a few financial solutions available to keep you afloat before your settlement checks in, such as lawsuit funding. If you are looking for a lawsuit loan in Las Vegas or anywhere else in the country, read on before you make a decision.
What Is a Lawsuit Loan?
Also known as pre-settlement funding, a lawsuit loan is an advance amount you can borrow from lenders, which is later deducted from your expected settlement.
In most cases, these types of loans are borrowed by people with personal injury lawsuits because they tend to accumulate more bills than other cases. Additionally, the type of injury, whether from a work accident or car crash, does not matter as long as your lawsuit claim has merit.
When you apply for a lawsuit loan, the lending company will assess your case to determine its approximate value. They will then offer an amount of funding that you must pay along with interests and additional fees when applicable. Ensure that you go over these details with your attorney to ascertain that the loan will not introduce more financial problems.
Advantages and Disadvantages of Lawsuit Loans
Pros
The best thing about a lawsuit loan is that it’s there when you direly need it. In other words, getting pre-settlement funding will tide you over in your hour of need. Depending on the type of accident, personal injuries can even incapacitate you so that you are unable to earn a living.
The best thing about a lawsuit loan is that it’s there when you direly need it. In other words, getting pre-settlement funding will tide you over in your hour of need. Depending on the type of accident, personal injuries can even incapacitate you so that you are unable to earn a living.
After a while, the amount of savings you had will dwindle, leaving you with unpaid mortgages, household bills, medical bills, and so on. A lawsuit loan gives you relief from all this pressure.
The second-best thing about pre-settlement loans is that there is no obligation to pay! If for some reason, your attorney is unable to win the case, the lending company will not require you to repay the loans.
As such, pre-settlement loan lenders are usually keen to evaluate any lawsuit that’s brought before them. This is to ensure that the case has higher chances of winning and with how much.
Finally, having access to pre-settlement funding reduces the pressure to accept the first offers from insurance companies. More often than not, these settlement offers are barely enough to cover all the damages. Having this source of money to pay the current bills gives your attorney sufficient time to negotiate the best offer possible and without a rush.
The second-best thing about pre-settlement loans is that there is no obligation to pay! If for some reason, your attorney is unable to win the case, the lending company will not require you to repay the loans.
As such, pre-settlement loan lenders are usually keen to evaluate any lawsuit that’s brought before them. This is to ensure that the case has higher chances of winning and with how much.
Finally, having access to pre-settlement funding reduces the pressure to accept the first offers from insurance companies. More often than not, these settlement offers are barely enough to cover all the damages. Having this source of money to pay the current bills gives your attorney sufficient time to negotiate the best offer possible and without a rush.
Cons
Unfortunately, having an active lawsuit does not automatically mean that any pre-settlement funding company will work with you. Lenders are usually careful about who they fund because unsuccessful lawsuits do not have to refund the loans.
If your application has been denied, consider looking for another equally reputable lending company because their acceptance terms might differ.
The most important thing to remember about lawsuit loans is that they are also financial costs. This means that besides the amount of money you borrowed as a loan, there are other additional costs that you have to consider before borrowing.
First, there are normal interest rates that will apply depending on the company and the state’s policies. Second, some lenders will also charge you a funding fee on top of the interest. If you anticipate that your lawsuit is going to take long, ensure that you calculate the overall cost of a pre-settlement loan before taking one.
The most important thing to remember about lawsuit loans is that they are also financial costs. This means that besides the amount of money you borrowed as a loan, there are other additional costs that you have to consider before borrowing.
First, there are normal interest rates that will apply depending on the company and the state’s policies. Second, some lenders will also charge you a funding fee on top of the interest. If you anticipate that your lawsuit is going to take long, ensure that you calculate the overall cost of a pre-settlement loan before taking one.
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