Many people involved in a lawsuit find themselves in a difficult situation. Not all lawsuit attorneys representing a plaintiff work on pro bono or contingency fees. They require a retainer fee up front and payment for other costs of the lawsuit trial. This type of financial requirements is difficult if not impossible for 90% or more plaintiffs. This is a big reason why many people don't follow through with a lawsuit, or settle with a less experienced attorney or law firm. There is an option; a pre settlement loan is a great way to secure legal funding.
A settlement loan is basically an advance on the possible monetary award of your lawsuit. A settlement loan provider will give you a cash loan which can be used for whatever you'd like, including legal funding. In return, if your case reaches a verdict in your favor and money is awarded you'll pay back the loaned amount, interest and a nominal fee. If you happen to lose your case you are not required to pay back the loan, that's right a settlement loan is a non-recourse loan, meaning it's only required to be paid back if you win your case. This is an excellent solution for a plaintiff in need of legal funding but unable to get access to funds with their own assets.
Now, look at the advantages your able to get a cash loan in advance of any awarded money in your lawsuit, to spend as you need. This can lift a big financial burden off the plaintiff, and allow legal fees to be paid, medical bills, monthly payments, etc. In return, the downside is you are required to pay back the full amount, interest and a nominal fee only if you win your case. That being said, you should only get a loan on the absolute smallest amount you need, perhaps enough for monthly expenses for a few months and your legal fees.
Remember, if your case reaches a verdict in your favor and awarded monetary gains you'll get much more from a judge or jury than you would with an out of court settlement. So, a settlement loan may cost you in interest, but overall increase the amount of money you're able to receive.
Saturday, February 28, 2009
Learn About a Lawsuit Pre-Settlement Loan
Settlement loans have become more popular by the year in the United States. One of the main reasons is the large amount of civil lawsuits in the US court system each year. With a large amount of lawsuits in the legal system it makes settlement loan providers able to loan more money to plaintiffs. A settlement loan is a simple concept; it is also known has legal funding or a lawsuit loan. Basically a provider or investor will give you a monetary loan based on your lawsuit. Some of the factors they look at are past case results, evidence in the case and amount of awardable money. Amazingly these providers have a 80%+ success rate in funding cases that reach a verdict in favor of the plaintiff.
You're probably wondering, "Well what is the benefit to the plaintiff?". Really, a settlement loan is an excellent source of financial income for someone in the middle of a pending lawsuit. This is especially true with accident and injury lawsuits since the plaintiff is unable or cannot work during the trial. This in return prevents the plaintiff from getting into to much debt, and even possibly losing their home. One of the most over looked benefits of a settlement loan is the fact it is a non-recourse loan. This is due to the fact that if you lose your lawsuit you are not required to pay back the loan; unlike with a traditional loan like a home equity loan you would still be required to pay it back.
A settlement loan will not effect the outcome of your pending lawsuit, in fact due to privacy laws and restrictions the defendant in your case will not even know that you applied for one, or if you were approved or denied. Even if by some miracle the defendant did find out it has no legal ground or merit in the lawsuit itself. Attorneys also favor settlement loans since it allows the case to go through the full trial and reach an awarded amount granted by judge or jury; which substantially increases the amount. So, in the eyes of an attorney they see settlement loans as a way to prolong the case and reach the maximum awardable amount.
Now, settlement loans do have their disadvantages and should be explained to plaintiffs, and most providers will only tell you the benefits and not the negatives. Since settlement loan providers are taking a big risk loaning out money that might not get paid back they do attach interest rates that would normally be given to people with bad or poor credit history. You'll have no control over the interest rate since your credit history and employment status play no role in the approval process. There is also a one-time fee that is paid back if you win your case; this is different between all providers and depends on the loan amount. It can range from $250 to $5000 in the majority of the cases.
It's your choice alone if you decide to get a settlement loan, as you can see above you need to weight out the pros and cons when deciding what's best for you. Speak with your family and attorney before making any decisions. Hopefully, you'll make the right decision that benefits you and not the provider. Remember, we all want money right away, but it's worth waiting a little longer to get what is rightfully ours.
You're probably wondering, "Well what is the benefit to the plaintiff?". Really, a settlement loan is an excellent source of financial income for someone in the middle of a pending lawsuit. This is especially true with accident and injury lawsuits since the plaintiff is unable or cannot work during the trial. This in return prevents the plaintiff from getting into to much debt, and even possibly losing their home. One of the most over looked benefits of a settlement loan is the fact it is a non-recourse loan. This is due to the fact that if you lose your lawsuit you are not required to pay back the loan; unlike with a traditional loan like a home equity loan you would still be required to pay it back.
A settlement loan will not effect the outcome of your pending lawsuit, in fact due to privacy laws and restrictions the defendant in your case will not even know that you applied for one, or if you were approved or denied. Even if by some miracle the defendant did find out it has no legal ground or merit in the lawsuit itself. Attorneys also favor settlement loans since it allows the case to go through the full trial and reach an awarded amount granted by judge or jury; which substantially increases the amount. So, in the eyes of an attorney they see settlement loans as a way to prolong the case and reach the maximum awardable amount.
Now, settlement loans do have their disadvantages and should be explained to plaintiffs, and most providers will only tell you the benefits and not the negatives. Since settlement loan providers are taking a big risk loaning out money that might not get paid back they do attach interest rates that would normally be given to people with bad or poor credit history. You'll have no control over the interest rate since your credit history and employment status play no role in the approval process. There is also a one-time fee that is paid back if you win your case; this is different between all providers and depends on the loan amount. It can range from $250 to $5000 in the majority of the cases.
It's your choice alone if you decide to get a settlement loan, as you can see above you need to weight out the pros and cons when deciding what's best for you. Speak with your family and attorney before making any decisions. Hopefully, you'll make the right decision that benefits you and not the provider. Remember, we all want money right away, but it's worth waiting a little longer to get what is rightfully ours.
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