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Archive November 2017

Opting for Legal Finance to Take Care of All Your Money Woes

Legal financing is essentially a cash advance on the future settlement or jury award you will receive. You are only eligible for it if you have filed a lawsuit (personal injury, wrongful termination, etc.) against a person or company, and you have a competent lawyer handling your case.

A lot of people shy away from legal financing because it charges higher interest rates compared to banks and credit unions. However, it also has its share of benefits. In fact, we’d go so far as saying that getting lawsuit financing has more benefits than drawbacks.

First of all, there is no financial risk on the litigant. If you lose your case, you don’t pay the lender anything. Secondly, it will enable you to pay all your outstanding debts, prevent you from declaring bankruptcy and even help you keep your home. In addition, with this kind of financing, you won’t be pressured to accept low ball out of court settlement offers because you won’t be desperate for money. Finally, you can even afford to pay expensive expert witnesses (doctors, psychologists, etc) that will further boost your case.

Obviously, this kind of legal finance loans is not for everyone. But if you have very few choices, if at all, then opting for a lawsuit finance would serve you well. Before deciding on which lender to do business with, see to it that you do your homework and compare rates from various lenders.

Where Can You Get Pre-Settlement Funding?

Pre-settlement funding is a finance service that gives plaintiffs an advance on their future settlement. It gives the plaintiff the benefit of having the financial resources he needs to pay for his expenses while awaiting the result of his case.

Banks and traditional lenders do not offer this kind of funding or loan. That’s because they’re concerned about the implications and the high risks associated with pre-settlement funding. It’s a non-recourse loan that puts a lien on the future settlement of the litigant. If they don’t receive a settlement or award, the lender gets nothing. Apparently, banks can’t be bothered with such high risk transactions.

But there are lenders offering settlement funding or cash advance. You can find them online. Due to the growing demand for this kind of financing, there are now many lenders offering such service. However, it’s imperative that you choose your lender carefully. This financing is largely unregulated and you could easily fall victim to unscrupulous lenders who charge sky-high fees on your loan. In fact, there are many horrible stories about plaintiffs paying double or even triple the principal amount. You don’t want to be one of them!

To prevent this from happening to you, you must take the time to scour the Web for your best options for lawsuit cash advance loans. Compare their rates and terms. Look into their background and read reviews about them. That way you can be assured you’re getting a fair deal.

Legal funding & Financing California

Pre-Settlement Loans Case Study

Explaining the benefits of pre-settlement loans may be difficult because a lot of people already have pre-conceived notions about this type of financing. So let’s just go ahead and look at one example to help you understand that these loan options aren’t so bad after all.

Mr. A. Collins was injured by a drunk driver while he was driving on the freeway one night in January of 2012. He had no health insurance, unfortunately but he did have a life savings amounting to $26,380 tucked away in the bank. But a month of hospitalization and 8 months of rehab cost him over $43,000 which means he still had to borrow money just to pay for everything.

Mr. Collins couldn’t find work months after his rehab and so he was in danger of losing his home, which was what he put up as collateral to get the money he needed to pay for his medical bills. He sued the defendant and was offered an out of court settlement of $50,000. Obviously, the litigant felt that was a low blow offer. Although he felt a lot of pressure because he had no money to pay his bills, he decided he could get the compensation he deserved if he went on with his lawsuit. What he did instead was to apply for one of those pre-settlement loans and received $70,000. Five months later, the jury awarded him $150,000. He paid back the lender $70,000 plus interest (about $6,000).

So, even though he paid a significant amount of money in interest charges, he’s still glad he chose this option otherwise he wouldn’t have gotten the $150k settlement.

 

Pre-settlement loan: understanding the basics

The pre settlement loan period is the time after which a plaintiff has brought a claim, but it has not yet been executed or a judgement has not been issued. At this time, the legal claim is normally still pending. Legal researchers have found that claims normally remain at this stage for an average of about 297 days. The “pre-settlement loans” is actually a cash advance against the future claims settlement. It is a payment that helps the person in need during some of the most troubling financial times they could ever face. They can help take care of daily expenses like bills and mortgages and provide financial help during such times.

These loans are not the same as traditional debt financing, and do not require monthly payments. Further, one does not have to pay if they lose their claim in court. Given these terms, there is always the allure to borrow more money than one actually needs. This might end up being a poor decision. Here are some important tips that will help you borrow the right amount;

Interest rates and fees

Before committing oneself, ask clearly about the interest rates and the fees involved. The best pre-settlement loan provider always make the process transparent. Still, it pays to find out whether there are any hidden costs or mandatory insurance fees before formally signing the agreement.

Pre-Settlement Loan: Case details

Being able to provide all the relevant details of the case at the time of application saves everyone a lot of time. The loan company will likely find it more difficult to approve the loans without all the details provided anyway. They will demand information like hard evidence, police reports and medical reports before the actual approval. Collect all this information from your lawyer and have them handy.

The lawyer

Your lawyer remains a good resource even when looking for a settlement company. Ask them for recommendations or talk to him about the company you finally choose.

The “pre-settlement loan” period is perhaps the most difficult time after a case has been lodged. With a good lawyer and pre-settlement loan company, you will be in the right hands legally and financially.