Often times, when you file a lawsuit, the damages incurred were so great that you struggle to get by financially. Maybe a car wreck caused injuries so great that you can’t work anymore. Maybe you lost your job for unfair reasons, and have no way to pay the bills now. In this situation, you may not have the financial stability to support yourself in the months and sometimes years that it takes a lawsuit to go through litigation.
Because of this common scenario, pre settlement loan companies have been developed to help plaintiffs get by until their lawsuit is processed. A pre settlement loan company gives the plaintiff cash to get by until their lawsuit is settled. When the lawsuit closes, the plaintive repays the amount that was borrowed from the pre settlement loan company out of the money collected in the lawsuit. If you are in the tough position Of needing money before your lawsuit is complete, here is a quick overview of how a pre settlement loan funding works:
What kind of cases are eligible for pre settlement lawsuit funding?
In order to qualify for a pre settlement lawsuit loan, the plaintiff has to have an attorney who is working on their viable lawsuit. Many times, you will need to make the case that the damages sustained in cause of the lawsuit is the reason that you cannot support yourself. Sometimes, a pre settlement loan company will not extend funding if the case is a class action lawsuit.
What are the greatest pre settlement loan benefits?
Many times, lawsuits work in favor of the more financially secure rather than what is fair. The injured party is already in a fragile and financially desperate position due to the damages. Often, major corporations and insurance companies who are being sued utilize a “delay, deny, and defend” strategy to drag out the lawsuit unnecessarily. This makes the injured party more and more desperate and willing to settle early, even if it means the settlement being pennies on the dollar of what they deserve. Pre settlement loans offer the plaintiff enough money to live on until the case finally closes, so that they are not forced to accept a deal that is less then they are owed.
What if the plaintiff has poor credit due to their financial difficulty?
Pre settlement loan companies use the lawsuit as collateral for their funding. This means that the plaintiffs employment status and credit are not a factor in determining if they qualify and the amount of money they qualify for.
How is the funding amount determined for a pre settlement loan?
Since pre settlement loans are designed to help the plaintiff hold out for the settlement that they deserve, it should be used only to get by. Many pre settlement loan companies will give about 10% of the total award predicted in the case, and many times in small payments that help the plaintiff cover financial needs over time, rather than one large payment.