Benefits Of Lawsuit Loans Compared To Bank Loans And Other Funding Sources
When it comes to securing funding for a lawsuit, we might say that lawsuit loans are a relatively recent trend. Before pre-settlement funding became a reliable litigation financing method that it is today, Plaintiffs were forced to turn to other methods to fund their lawsuits. And we say forced because they had no other choice. There was just no alternative method available to finance their lawsuits but to get a personal loan, a new credit card, borrow against a mortgage or borrow against a 401K.
These methods of litigation financing are still available today, but we’re unsure why any plaintiff would want to use them considering lawsuit loans have proven to be a far better option. If you’re still hesitant on whether or not settlement funding is what it’s cracked up to be, RapidLawsuitFunding.com can’t wait to show you how much you’ll benefit by using Lawsuit Loans vs Bank Loans and other funding sources. Opponents to Lawsuit Loans have made claims that they have their inherent risks, however, we would like to prove to our future clients that this is not the case.
Taking Out A Personal Loan
Plaintiffs who have never tried Lawsuit Loans before might first consider taking out a small personal loan with their regular bank or credit union. At first, that doesn’t seem like a bad idea. A personal bank is something you’re familiar with and in most cases, you already have a relationship with that bank or institution. That said, personal loans can lead to plaintiff financial suffering once their trial has ended, and anyone looking into receiving a loan from their financial institution should properly weigh all of the pros and cons before they make a final decision.
The Advantages Of Taking Out A Personal Loan
We can’t deny that there are some advantages to getting a personal loan from a bank if you are a plaintiff under financial strain. Firstly, regardless of whether it is true or not, most people think that taking out a personal loan is a clever option. Indeed, if you are a plaintiff with a solid credit rating, you may be able to receive a loan with a very low-interest rate. But personal loans more often than not come with a fixed repayment period. In some cases – depending on their financial standing with the institution – plaintiffs may be able to spread out their repayments over several years to give them more time to repay their debt.
The Disadvantages Of Personal Loans
Although the advantages of personal loans may seem very attractive (especially tho plaintiffs in financial strain), their downsides far outweigh these advantages.
What can’t be ignored with a personal loan is that you must have a good credit rating in order to get a half-way reasonable interest rate. Also, if you already have pending loans with other financial institutions, it may impede your ability to be approved for a loan.
Unlike Pre-Settlement Funding, repayment is necessary with personal loans – it doesn’t matter whether the plaintiff has won their case or not. This can be detrimental in states in America where a plaintiff must cover the defendant’s costs if they lose the case. Failure to repay the loans in a timely manner can result in the loan going into debt collection. If the plaintiff finds themselves in debt collection, they could have a lien put on their account, lose their property (at least temporarily), or even be forced into declaring bankruptcy.
Signing Up For A Low-Interest Credit Card
Plaintiffs who are in financial need may think that signing up for a Low-Interest Credit Card may be a reasonable way to dig their way out of all the mounting bills. As attractive as that quick solution may sound, we would like to show you how signing up for a credit card can be a bad idea in the long run.
Advantages Of A Low-Interest Credit Card
It’s understandable why plaintiffs find the idea of signing up for a low-interest credit card attractive when faced with financial pressures. In general, credit cards can have a lower interest rate than a pre-settlement loan. And if you’re lucky enough to sign up for a card with a 0% APR, it can be very useful as long as you pay it back before the end of the promotional period. Credit cards are also generally accepted everywhere, and that flexibility is very appealing if you are a plaintiff under a lot of economic stress.
Disadvantages Of A Low-Interest Credit Card
Even if you are lucky enough to find a credit card with a 0% APR, if you aren’t able to pay off your charges within the promotional time limit, you can expect a large spike in your interest rates. Also, much like a personal loan, repayment on your credit card is absolutely necessary. Unlike lawsuit loans, interest will continue to grow after a verdict on your case has been reached. Credit cards can also take weeks or months to be approved, and a credit check is needed. Worst of all, if you are rejected in your credit card application for any reason it can negatively affect your credit rating!
Borrow Against Your 401k or Mortgage
Another way Plaintiffs can fund their lawsuits and deal with growing financial pressures is by borrowing against either their mortgages (if they are home owners), or their 401K plans. It’s clear why this idea is so enticing to plaintiffs who are in need of money but these types of financial loans can be a big mistake.
Advantages Of Borrowing Against Mortgages & 401Ks
The main advantage of borrowing against a mortgage or 401K is that you are dealing with pre-existing collateral that is already in the financial institutions system. This not only makes this type of loan easy, but Plaintiffs can receive a loan in a relatively quick amount of time. In a short period, you can receive the money you desperately need to cover the legal fees and other bills.
Disadvantages Of Borrowing Against Mortgages & 401Ks
The consequences of these types of loans can be extremely difficult to bear. If the plaintiff loses their case and is unable to repay the loan, they could easily go bankrupt, seriously jeopardize their retirement savings, or even lead to the bank taking repossession of the plaintiff’s house.
Funding A Litigious Matter Using Lawsuit Loans
Considering these financial tools are relatively new to the legal market, it’s actually amazing how popular Lawsuit Loans have become! It makes perfect sense why they’re taking the legal funding world by storm: they’re easy to apply for, quick to receive, and relatively no-risk! But before we explain all the benefits of these loans, let’s address areas where pre-settlement loans can be problematic.
Disadvantages of Lawsuit Loans
Plaintiffs should make sure to only rely on the best lawsuit loan companies (such as Rapid Lawsuit Funding), otherwise, they may end up paying a much interest rate. Also, the plaintiff may receive a marginally lower return after settlement due to the interest rates. However, if you are careful in your selection of a lawsuit loan company, you can avoid these problems.
Advantages of Lawsuit Loans
The biggest advantage of pre-settlement funding is that Lawsuit Loans are essentially RISK-FREE. You are only required to pay back your lawsuit loan if you win your case, something that isn’t an option with traditional bank loans. What’s more, after applying for a lawsuit loan, Plaintiffs usually see their loan in their bank account within 24 to 48 hours. Lawsuit Loans also require no credit check and no employment check, and, since we also will not look at your current income, they will not affect your credit rating in any way!
The Lawsuit Loan company will communicate directly with your solicitor regarding repayment, but in the meantime, you could use the cash you received for whatever purpose you want. Loans usually fall anywhere between $500 and $100,000 and plaintiffs can receive them on top of other funding sources!
Lawsuit Loans Are Clearly The Best Way To Fund Your Case
As you can see, there are very few disadvantages to signing up for Lawsuit Loans as opposed to other litigious funding methods. They may still be recent in the lending market, but they are gaining popularity by the day thanks to their no-risk nature and quick approval process. Before you consider applying for a personal loan, a new credit card, taking a loan against your mortgage or 401K, you should think about the benefits that plaintiffs across the country experience thanks to Lawsuit Loans – Start Your Application Today and Find Out For Yourself!