7 Important Reasons You Should Get Pre-Settlement Funding
Should I or should I not? Find out the important reasons you should get pre-settlement funding in our essential guide to pre-settlement funding loans.
Following an accident where you incur injuries you likely have high bills and lost wages. You may have a pending lawsuit, but that process is lengthy and you need money now.
Pre-settlement funding is a popular way to quickly get the funds you need. You may be concerned about covering the cost of a pre-settlement loan plus your attorney fees. We are going to share how the cost is calculated and the benefits of this popular loan option.
What is Pre-Settlement Funding?
Similar to a loan, pre-settlement litigation funding is actually a cash advance against your pending lawsuit. There is no physical collateral.
If you do not win your case, you do not have to repay the loan. This makes this type of funding an ideal no-risk option if you need fast cash.
If you are unsure about how this will impact your lawsuit pay-out, you may want to consult your attorney regarding this type of cash advance.
The Benefits of Pre-Settlement Funding
Product liability and personal injury lawsuits often drag on for months, and sometimes years. This can be stressful when you lack the financial resources you need now. Here are the reasons pre-settlement litigation funding is an excellent choice.
1. Loss of Wages
Many lawsuits are the result of an accident causing severe bodily harm. Serious injuries will take you out of work for weeks, sometimes months. Without income and unable to pay bills, you are at risk of losing your home, car, and destroying your credit rating.
Pre-settlement lawsuit funding can bring peace of mind and allow you to keep your home and other assets intact.
Obtaining pre-settlement funding is quick, usually within 24-48 hours. A personal loan at a bank will take a lengthy period of time while you undergo credit checks and they delve into your personal finances and bills.
There is no stress worrying about loan approval while juggling your bills. You will not incur high-interest fees from overusing your credit cards to pay bills.
3. No Out-of-Pocket Cost
Unlike a bank loan, where once you receive the money you need to begin repayment, pre-settlement funding is not paid until your lawsuit settles. Your lawyer will deduct what you owe on attorney fees and the loan from your settlement amount. You receive the remaining balance.
If you did not win a settlement, you will owe nothing.
4. No Credit Check
When you apply for a loan through any financial institution such as a bank or credit union, you have to undergo a credit check. That hard inquiry negatively impacts your credit score. Overuse of your credit cards also has a negative effect on your credit.
When you apply for pre-settlement litigation funding there is no credit check. The only requirement is to have an eligible case that is likely to result in a favorable settlement.
The loan is repaid using settlement funds. It is only the likelihood of reaching a settlement that impacts whether or not you will be granted a loan.
5. Prevents Bill Collectors
It happens frequently, the main wage earner in a family suffers injuries and loss of income during their recovery. Bills are paid late or not paid at all. The stress of having no money to pay a stack of bills when collection agencies are hounding you with phone calls and written notices can be overwhelming.
Often following a personal injury you will incur additional medical bills for surgery, physical therapy, diagnostic tests, rehabilitation facility stay, and follow-up medical appointments.
If the accident was severe enough to require an emergency airlift, a helicopter ambulance flight costs around $10,000. An air ambulance plane flight is about $39,000. The actual cost is based on how far the helicopter or airplane needs to fly.
Medicare only covers about 1/5 of the aircraft fees and 1/7 of the mileage fee charged for this type of transportation.
Pre-settlement funding allows a personal injury victim to stay on top of all bills, including extra medical expenses. This prevents financial delays in receiving medical treatment. The goal is a quick recovery and return to a normal life while the case is pending.
6. Saves Your Savings
When money is short there are two places we go, our credit cards and our savings account. You may even have the recommended 3-6 months of emergency funds tucked away, but that is not enough if the lawsuit takes longer to settle.
Rather than depleting your savings account, take out a pre-settlement funding loan against your lawsuit and keep the money in your savings account for the future.
Applying for pre-settlement litigation funding is fast and easy and can be done right from home. You can complete the application online. There are no income verifications, no need to provide information on bank account balances, outstanding bills, or any other financial information.
Information about your lawsuit is all that is needed. After evaluating your case the company will provide you with a loan based on the value of the anticipated settlement, often within 24-48 hours.
What Does Pre Settlement Lawsuit Funding Cost?
There are no out-of-pocket costs to obtain a pre-settlement funding company advancement. You do not make payments against the loan until you reach a settlement. If your lawsuit fails to reach a favorable settlement, you do not have to repay the loan.
The cost for the loan varies between 1.99% per month to 3.99% per month compounding monthly. What this means is the rate for the loan will likely fall between 30% to 60% annually.
The best way to determine your actual costs is to consult with a lawsuit settlement funding company.
The Legal Viewpoint
Pre-settlement lawsuit funding has become popular and states have begun enacting consumer protection legislation. The Alliance for Responsible Consumer Legal Funding (ARC) advocates for consumer protection legislation and makes recommendations on what legislation should include.
The American Bar Association Commission on Ethics 20/20 believes pre-settlement funding loans fulfill a need. They suggest attorneys watch for ethical issues. Their white paper recommends attorneys make sure their clients understand the loan agreement terms and that client confidentiality remains secure.
Obtaining a Loan is Easy
Getting a pre-settlement funding loan from Legal-Bay is easy. Simply fill out the online application form and wait for a telephone call from a Legal-Bay representative.
The representative will gather additional information and start processing your loan. A request will go to your attorney for information necessary to evaluate your case. Within 48 hours you will receive notification of the amount we are able to advance you.
Why wait? Legal-Bay agents are available by phone 24 hours a day, 7 days a week. Complete your online application and you are on the way to receiving a pre-settlement funding loan.
If you have any questions don’t hesitate to contact us online or by phone (877) 571-0405 to speak with an agent.