You may have seen advertisements on television regarding lawsuit loans, never thinking you may be in need of one yourself. Now, you have suffered injuries due to another party’s negligence and are involved in a lawsuit. However, it’s becoming almost impossible to pay the household bills, medical costs are through the roof and your income is on hold if you cannot work. This is where lawsuit loans come in; keep reading if you want to be enlightened about the process, and the benefits to you.
Basically, litigation funding (another term for lawsuit loans) is a process in which if approved, you receive a cash advance against your pending settlement. This advance is typically about 10% of what you expect to win. Unlike conventional loans, there are no monthly payments to make – you only repay the advance once you have won your lawsuit and have money in hand. Because it is no recourse, you are not responsible for repaying the loan in the event you do not win. Therefore, you are at no financial risk.
Lawsuit loans are only approved for those who have a strong claim, so frivolous claims are not accepted. If you sustained injuries more serious than minor bruising or sprains, for instance broken bones, lacerations, head trauma, spinal injuries, etc., chances are you will qualify. With litigation funding, the company will only require information related to the accident and your resulting injuries. You will not be required to provide information regarding your credit standing, employment status, or any other background information.
There are no upfront costs or out-of-pocket expenses with lawsuit loans, so you don’t have to worry about going further in debt. Any fees or interest will be repaid to the litigation funding company when you repay the actual advance. An advance may be used to pay attorney fees so that your lawyer can build a strong case on your behalf, to pay household bills, buy groceries and basically live a normal life while waiting for your lawsuit to complete.
Basically, lawsuit loans allow you to have access to “upfront” money, so that you can avoid financial disaster while waiting for your lawsuit to settle. Should your lawsuit settle for less than the advance you were given, that amount is all you owe to the funding company - nothing else. Litigation funding is not a solution in every situation, but it has helped tens of thousands stand on solid financial ground while awaiting settlement of their lawsuits. Discuss lawsuit loans with your attorney to decide whether it is an option you should pursue.