After reading this article, the reader will be able to understand the function and purpose of a lawsuit loan. This article aims to give basic information on a lawsuit loan, also known as legal settlement loans, lawsuit funding or lawsuit cash advance.

Are you a plaintiff in a pending lawsuit? Do you need money to cover unforeseen expenses? Lawsuit loans can help defray costs. A plaintiff in a pending lawsuit can benefit from a lawsuit loan. A typical lawsuit in the civil court system can take months if not years for a verdict. With a lawsuit loan you can get up to 10% of your future settlement now. This can help prevent a plaintiff having to settle out of court for a lesser amount than what a jury might have awarded. Typically plaintiffs in a pending lawsuit go through financial troubles, and this is especially true with injury and wrongful death lawsuits. A lawsuit loan is an option to prevent foreclosure, repossession or bankruptcy.

Attorneys have mixed feelings about a plaintiff applying for a lawsuit loan. Attorneys often witness the financial troubles a plaintiff goes through and know a lawsuit loan is an excellent way for them to receive the cash they need. Attorneys also know a lawsuit loan can prevent early settlement of their client’s pending case, which results in more money for them. Issues can arise with your attorney and a lawsuit loan if you have a contingency agreement that can be broken due to a lawsuit loan. It’s a good idea to consult your attorney prior to applying for a lawsuit loan.

LAWSUIT LOANS AREN’T REALLY LOANS

Lawsuit loans really aren’t loans at all. Lawsuit loans are considered to be non-recourse debt. Non-recourse debt is a secured loan based on collateral. With a lawsuit loan your collateral is your pending lawsuit and the possible future monetary award. Unlike traditional loans you won’t need to have your credit checked, have a specific term of employment or a specific income level. The factor in deciding if you get a lawsuit loan is based on your lawsuit. With a lawsuit loan the lender is buying an interest in your pending lawsuit. They are investing money. If you win your case they receive their initial investment back, plus interest and fees. The amount you are advanced loan is based on your probable awardable amount. This means you’ll be able to get up to 10% of what your case is worth. Lawsuit loan providers loan as little as $250 to as much as $100,000. It is possible to receive a lawsuit loan higher than $100,000 based on the case itself.

LAWSUIT LOAN REPAYMENT IS BASED ON CASE RESULTS

The biggest benefit of a lawsuit loan is that if you don’t win your lawsuit you don’t have to pay back one dollar. This means you can use a pre-settlement lawsuit loan as a no-risk loan, unlike with a traditional loan or a credit card where you would still be required to make payments regardless of the cases outcome. This is why lawsuit loan providers do heavy research into your pending lawsuit. You’ll never receive a lawsuit loan based on a frivolous lawsuit, and even some lawsuits with probable merit can get denied. You can expect your lawsuit loan provider to review all your case documents, speak with your attorney and review past case verdicts like yours. In return for a lawsuit loan’s no risk factor you can expect heavy research into your case. If you need financial assistance during your pending lawsuit you should apply for a lawsuit loan.

DISADVANTAGES OF A LAWSUIT LOAN

The disadvantage of a lawsuit settlement loan can be higher than normal monthly interest rates. These interest rates can range from 4% to 9% or even higher, depending on the amount of money and the success rate of your specific case type. Lawsuit loans also have fees added onto the original loaned amount. It’s a good idea to research all the fees and interests associated with the lawsuit loan provider you apply to. Plaintiffs sometimes take out more than one lawsuit loan. This is due to not applying for enough money from their original lawsuit loan. It’s a good idea to speak with your attorney and try to get a general idea of how much longer your case will take before deciding on an amount. This way you can take only what you need with your lawsuit loan.

SUMMARY

Lawsuit loans can be a good way for plaintiffs in need of financial assistance to obtain it without risk. Even after considering the interest and fees you’ll see that with the no risk factor it’s a beneficial option for a plaintiff in need of cash. Always do your research into the lawsuit loan company you plan to apply to. Know the interest rates and fees up front. Lawsuit loans can be applied for online.