The average civil suit is a long, complicated, and drawn out affair that can take more than 1-2 years from start to finish. That’s time when you’ll be struggling to pay the mortgage if you’re out of work, unable to go on vacation because you’re worried about lawyer fees, and stressed about the outcome of your case. Instead of putting your life on hold while you’re waiting for justice to be served consider funding options like lawsuit loans to help make ends meet during the trial.
Why Would I Need a Lawsuit Loan?
Imagine this, you’re on your way to work and you get sideswiped by a truck that just ran a red light. Your car is totaled and you end up in the hospital with serious injuries. The insurance company of the guy that hit you wants to settle fast because they know that going to court will cost them a lot of money. But instead of settling you hire a lawyer and take them to court to get the money you deserve to buy a new car and pay your hospital bills.
While you’re waiting the years it takes for most personal injury cases to make their way through the courts, you’re not able to work because your injuries. Bills start piling up, you’re getting calls from creditors, and the stress of fighting the insurance company is affecting your health. You’re considering just settling the case to get it all over with.
Well, instead of settling for less than you deserve why not leverage the asset that is your court case to get the money you need now?
How is this Different from a Traditional Loan?
Also known as settlement funding, lawsuit loans are a type of funding that can help you to get the cash you need now without any risk.
Settlement loans are available to anyone who has an attorney and is currently in the middle of a civil suit. A funding company will review your case and generally make you a loan offer within 48 hours. No need for a credit or employment check. And the best part is, if you don’t end up winning your case you don’t owe the lawsuit lender a dime!
Litigation lending is a form of non-recourse funding which means that the only asset the lender has rights to is your suit winnings. So if you don’t win, or the other party doesn’t pay, you don’t have to worry about repaying the loan. All is forgiven.
With a traditional loan you are obligated to make your payments no matter what. So if you lose your job or have medical bills you’re having trouble paying it doesn’t matter, you must continue making your payments.
Issues to Consider When Looking for a Loan
When looking for a funding company there are some important points to consider to help determine which lender is best for you.
|How Much Can I Borrow?||The minimum amount you can borrow is typically around $1,000 and maximums can exceed $500,000.|
|Type of Lawsuit||While most lenders will fund loans for any type of lawsuit, some specialize. So when you’re looking for a lender make sure they cover the type of suit you’re involved in. Either check their website or speak with a customer service representative before filling out an application.|
|When is Payment Due||Payment is due in full when your case is settled and you receive your settlement. You should not have to make any payments while your case is still on-going.|
|Credit Score and Employment Verification||Unlike most loans that require a credit check and employment verification, neither is necessary with a lawsuit loan. Your loan is based solely on the projected outcome of your case.|
|Customer Service||When you spoke with the customer service representative were they able to answer your questions? Were they respectful and courteous? You’ll need to work closely with the settlement lender so you want to make sure you find one you’re comfortable with. If they fail to respond to your questions promptly and professionally that’s probably a sign you should look elsewhere.|
|Length of Time to Fund Your Loan||Some lenders are able to fund your loan in less than 48 hours from the time you submit your application. You know best how long you can wait before you run out of cash so don’t be talked into a quick turnaround time in exchange for higher fees if you don’t need it. While 48 hours is generally the fastest loans can funded, most companies can complete the process in a week or less.|
|Fees||Reputable lenders do not charge application fees, or will waive the fee if you’re accepted for a loan. Be wary of structured settlement companies that ask for upfront fees, closing fees, or any other fee.|
|Do I need an Attorney?||Before you’re eligible for a loan you’ll need to have an attorney. Your attorney will need to provide the lender with an update on the status of your case and will advise you on the best settlement funding option.|
Structured Settlement Buyout
If you’ve already gone through the lawsuit and have a structured settlement that pays you monthly or annually there are funding options for you too. This type of settlement, sometimes also referred to as a structured settlement annuity, provides you with periodic payments over a predetermined period of time. For example, you may have agreed to receive $1,000 per month for a period of 5 years. Depending on the amount of the payments, it may not be enough to cover your current expenses or for you to live off of, especially if the agreement was reached several years ago and your cost of living has increased. If you need more cash now you should look into structured settlement loans.
With a structured settlement buyout, a buyer buyer pays you a lump sum now in exchange for the rights to your recurring payments. While your recurring payments are probably a small amount of money, the lump sum cash payout can be substantial. Use the money to put a down payment on a house, send your kids to college, or take the trip of a lifetime. There are no restrictions on what you can do with the money.
So if circumstances require you to take out a loan remember to look for a reputable lender that has your best interests in mind and will take the time to answer your questions and provide you with the best option for you.