Most Common Questions Regarding Lawsuit Loans And Pre-Settlement Funding
When it comes to lawsuit loans and pre-settlement funding, there are many questions you may have and many of them are common among all applicants. We have compiled the most common questions here so you don’t need to go elsewhere looking for answers.
Of course, are encouraged to continue exploring this topic on your own if you require more information.
So what do people most often ask when looking into lawsuit loans? Continue reading the post to discover.
What Is The Difference Between A Lawsuit Loan And Pre-Settlement Funding?
Lawsuit loans are meant to help with the legal cost as well as living expenses during the lawsuit if you are unable to provide for yourself. Lawsuit loans can be obtained at any point during a lawsuit. Pre-settlement funding works differently. It provides access to your potential settlement money ahead of time. Once you receive your settlement money and covert the attorney’s fees and pay the legal funding company, whatever remains belongs to you.
Pre-settlement funding is less risky as it is based on how likely a case is to be won. If your case doesn’t settle, you don’t have to repay the money. This is an advantage of pre-settlement funding over lawsuit loans.
Is There A Difference Between Lawsuit Loans And Regular Loans?
When applying for a regular loan from a bank you have to show them that you will be able to pay back the loan based on your income and assets. They will check your credit score, etc. With lawsuit loans, none of that is necessary and the only thing that matters is how likely you are to win the case.
Lawsuit loan companies examine the type of case and how likely you are to win the case, not how much you earn and what assets you have. A lawsuit loan is the best option if you need money during your lawsuit.
Can I Get A Lawsuit Loan Or Pre-Settlement Funding Without A Lawyer
While it is not impossible to do so, many lawsuit loan companies will not approve applicants without legal representation for either type of funding . Having a lawyer does come with extra costs, but a legal professional can help help you discover and use the resources you wouldn’t know about on your own. Also, you have higher chances of winning the case if you have a lawyer representing you. Having a lawyer shows the lawsuit loan companies that you are serious about your case. They also communicate with you through your lawyer and get the necessary information from them.
Does Having Bad Credit Prevent Me From Getting These Types Of Loans/Funding?
For most lawsuits, you may not need to divulge your credit score or get a credit check. However, with riskier cases, it may be necessary. If there have been many cases like yours in which plaintiffs received large settlements, you are very likely to be approved for pre-settlement funding or loan without any credit score check. As mentioned above, lawsuit loans and pre-settlement funding do not work like traditional loans, therefore, they don’t have the same requirements.
How Much Money Can I Expect To Receive?
This is a tough question as each case is different. Generally, the amount you get will largely depend on how much you requested, how much is usually awarded in similar cases, and how likely you are to win your case.
These calculations are complex and each lawsuit loan company will have their own minimum and maximum amounts they are ready to give. This can range between hundreds of dollars to several thousands of dollars. In rare cases, it could be even more, but that kind of amount should never be expected. Requesting the minimum amount you need is a good strategy in case you don’t win the case. If that happens, you don’t have a large sum to repay. In general, the loan companies offer about 10% of your expected win as a loan.
How Is Loan Decision Made?
The lawsuit loan company or the pre-settlement funding company will take the information provided about a case and study it closely. They will look at previous similar cases, precedents, whether these cases were won by the plaintiffs and how much was awarded to them. They will also take a look at your specific situation and ask questions about you and your lawyer before making a decision. It almost all depends on precedents and what others have received in similar cases as well as on how strong your own case against the defendant(s) is. Other factors may also be considered such as how much your medicals bills are so far, how much you lost in wages due to inability to work, your insurance policy and the defendant’s insurance (in cases where insurance is at play), and have you already received funding in your lawsuit.
Is It Possible To Get A Second Loan Or Advance?
Yes, but that is much more risky and has fewer chances of getting approved.
What Kind Of Fees Are Involved In Applying?
This will depend on each lawsuit loan and pre-settlement funding company. This means that some have application fees while some do not, some have processing fees while some do not. The one thing they all have in common is a percentage of interest rate, which means that they set a repayment plan with an indicated interest rate. This is the tricky part as the rates can be incredibly high in some lawsuit loan companies. You must check and compare these rates before you choose a lawsuit loan company. Make sure to check how these rates apply and what you owe in case you lose your case.
Some companies may obscure the details of the lawsuit loan contract which can end up draining you financially. Make sure to check all the details of the loan so that you are fully aware of the interest rate as well as any other fees that may apply. Getting a lawyer to look at these with you is the safest option.
Can My Lawyer Or Their Office Provide Me With The Loan?
No. They cannot do this as it would be unethical and can cause conflicts of interest.
Essentially, what is important to know is that you do need a lawyer to apply for legal funding. You also need to make sure that you understand the contract you’re signing so that any unpleasant surprises are avoided.
While you cannot get a loan from your lawyer directly, they can help you in finding a good lawsuit loan company with good interest rates. You can expect to get about 10% of what you are expected to receive in the settlement when the case is over. But remember that the purpose of the loan is to help you cope with the legal and other bills.
Finally, make sure to get all the information you can before signing a contract with a lawsuit loan company.
So, Where Do I Get Started?
You should get started right here, at Rapid Lawsuit Funding.