Settlement Money Early Archives

How to Get Settlement Money Early

If you are involved in civil litigation and are encountering financial strain, you may wonder if it’s possible to get settlement money early. In this post, we explain how to use lawsuit loans to get a portion of your settlement money early – prior to actually resolving your case.

What are Lawsuit Loans?

Lawsuit loans are specialty financial transactions where lawsuit lenders advance money on pending cases. Lawsuit loans are also known as settlement funding, legal funding, settlement loans, case loans and lawsuit funding.

Lawsuit Loans are Not Loans

Although the word “loan” is contained in some phrases describing these transactions, lawsuit loans are most definitely NOT loans in the traditional sense of the word. Traditional loans imply repayment at some point in the future. Lawsuit funding however allows you to get settlement money early by advancing cash in anticipation of settlement or recovery. Repayment is contingent upon a successful outcome.

This means lawsuit loans are risk free to plaintiffs who wish to get some of their settlement money early to the extent that repayment is made with the lawsuit proceeds themselves, not the plaintiff personally. Accordingly, lawsuit funding contracts are deemed “non-recourse” early advances on lawsuits.

Why You Might Need Settlement Money Early

Lawsuits take time and sometimes years may pass between the time a plaintiff is wronged in the eyes of the law and some sort of monetary recovery. There are many reasons why lawsuits take so long.

For example, a personal injury case might be forced to continue medical treatment or even surgery. Healing from injury adds to the litigation process because often, it is impossible to gauge the permanency and severity of an injury until all treatment options are exhausted.

While treating, plaintiffs are often not able to earn as much money as before their accidents. This adds stress to an already stressful situation leaving many plaintiffs susceptible to low-ball settlement offer tactics used by insurance companies to minimize the amount of compensation plaintiffs receive for their troubles.

How Pre-Settlement Funding Can Help

Lawsuit loans are an effective way to get settlement money early and resolve short-term cash flow issues that plaintiffs potentially face. Traditional bank loans involve lengthy credit checks and sometimes pledging collateral. Lawsuit loans involve no credit checks and no need to prove your income or employment status. Lawsuit loan companies rely solely on the strength of your case and how much you’ll likely receive when it’s over.

Even better, you can use lawsuit loans for any expense whatsoever. Many clients use early settlement money to pay for:

Medical treatment or surgeries
Living expenses
School tuition or education payments
Housing costs such as rent or mortgage payments
Consolidating existing debt
Transportation costs
Business expenses, and
other uses for lawsuit loans

Pre-settlement funding is a financial lifeline for plaintiffs, enabling them to cover their costs while waiting out the legal process. Getting settlement money early through lawsuit loans avoids the credit and employment issues which normally face traditional borrowers.

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How Legal Funding Works to Get Settlement Money Early

The legal funding process works as follows:

Plaintiff contacts lawsuit funder and gives some details about the lawsuit. This will include:
- Plaintiffs name, address and contact information
- Attorney’s name and contact information
- Date of accident/incident
- Amount of money needed early
- Whether plaintiff has received funding previously
Lawsuit lender chases paperwork from client and/or attorney and builds a file to send to a lawsuit funding underwriter.
Underwriter contacts attorney to discuss the case.
Decision is made and if approved, an offer for funding is presented to the plaintiff.
Plaintiff and attorney agree, execute and return the lawsuit funding contract.
Plaintiff receives funds via bank transfer or overnight delivery of a check.

The Costs for Getting Settlement Money Early

As stated above, legal funding contracts are only repaid if the lawsuit is successful. These are asset purchase agreements in which plaintiffs sell a portion of their settlement ahead of time. If the case should lose, what was purchased (settlement proceeds) is worthless. Thus, there is no repayment. That’s the good news.

The bad news is funding companies must charge for this additional risk of loss. Thus plaintiffs can expect to pay approximately 36% or more per year for cash advances on pending lawsuits.

And there is more good news – it’s never been easier to shop for lawsuit loans since information on lawsuit funding rates is plentiful on the internet if you take the time to look. Information on the types of lawsuit loan pricing structures (compounding vs. simple) and legal loan fees can be found all online. It might be wise to examine these types of costs and make a determination on which is the best fit for your personal situation.

Pros and Cons of Lawsuit Loans

Legal Funding: Pros

You get money in as little as 12-24 hours.
You can use the money however you wish.
You can refuse low-ball settlement offers and allow your attorney(s) to negotiate a better settlement.

Lawsuit Loans: Cons

Lawsuit loans can be costly – especially if a plaintiff doesn’t do his/her homework.
Not all cases qualify for lawsuit funding.
- Although many lawsuit loan case types exist, many more simply do not fit within the investment wishes of lawsuit “lenders”. These might include:
  - Social security cases
  - Divorces
  - Some workers’ compensation cases
  - Trust and Estate disputes
  - You are Pro Se (aren’t represented by counsel)
  - Your attorney is not representing you on a contingency fee basis.
  - and more. . .

Do You Need to Get Settlement Money Early

Above we discuss the benefits and drawbacks of getting settlement money early through lawsuit loans. Now you are in a better position to see if lawsuit loans are right for you. If you have any questions or want to know if you qualify, simply pick up the phone and give us a call. You’ll reach a live person during business hours who can answer your questions.

Or you can contact us online for more information. Fortunately, choosing the best lawsuit loan company is well within the reach of every plaintiff. Give us a call. We are here to help and are at your service.

Thank you for your interest in Fair Rate Funding.

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