Facing a personal injury lawsuit is already a challenging experience, but when you’re also responsible for spousal support payments, the financial strain can quickly become overwhelming. Failing to meet these court-ordered obligations can lead to serious legal and financial consequences, complicating your situation even further. Fortunately, pre-settlement funding offers a way to manage these payments effectively, helping you avoid the pitfalls of missed alimony obligations while allowing you to focus on your recovery.

In this article, we’ll explore the potential consequences of not paying spousal support and how pre-settlement funding can help you maintain financial stability during your lawsuit. From preventing legal penalties to preserving your credit score, understanding these options can provide you with peace of mind and a clearer path forward.

What Are the Consequences of Not Paying Spousal Support?

Violating a court-ordered spousal support can lead to significant legal and financial consequences, such as:

Legal Action: Your recipient spouse could take legal action against you, which might include the enforcement of the order by a court.
Financial Penalties: Courts may impose fines or late fees on missed payments, which can add to the financial burden.
Interest on Missed Payments: Often, unpaid spousal support accrues interest, and thus increases the amount you owe over time.
Wage Garnishment: In some cases, wages may be garnished to satisfy spousal maintenance debts, which will affect your income.
Impact on Credit Score: Non-payment of alimony obligations can negatively affect your credit score, making it difficult to obtain loans, credit cards, and even housing in the future.

Benefits of Using Pre-Settlement Funding for Alimony Obligations

Opting for pre-settlement funding to manage spousal support payments during your lawsuit offers key advantages. Primarily, It eases the financial burden you might face while your personal injury lawsuit is ongoing, helping you avoid the negative consequences of not fulfilling your alimony obligations. Because this type of funding is non-recourse, you only repay the money if you win your case, with repayment coming directly from your settlement check. This means there’s no added financial strain if your litigation is unsuccessful.

Here’s how this lawsuit funding can help you:

Preventing Legal Penalties: Pre-settlement funding helps you stay current on your alimony payments, preventing potential legal penalties such as fines, contempt of court, or additional lawsuits from your ex-spouse.
Protecting Parental Rights: Consistent alimony payments can positively influence custody arrangements or parental rights.
Maintaining Financial Stability: Funding helps you maintain a stable financial situation without depleting your savings or retirement accounts, which is essential for long-term financial health.
Reducing Conflict with Ex-Spouse: Keeping up with alimony payments using legal funding can reduce tensions and conflicts with your ex-spouse. This can help bring a more amicable post-divorce relationship, which is beneficial for co-parenting.
Providing Financial Flexibility: By securing funding during a legal battle, you can allocate other available funds to different urgent needs or investments, rather than using all your liquid assets to cover spousal support.
Supporting a Stronger Legal Case: Demonstrating the ability to meet your financial responsibilities can positively impact the perception of your case in court.
Avoiding Asset Liquidation: Pre-settlement legal funding allows you to meet alimony bills without having to sell valuable assets like your home or car.

Understanding Your Funding Application with Spousal Support Liens

When you apply for pre-settlement funding and you have outstanding debts for spousal support, the process to evaluate your application gets a bit more detailed. At Baker Street Funding, we carefully assess your case to make sure the loan makes sense for both you and us. Here’s how we handle it:

Review Your Legal Documents. First, we look over all the legal papers related to your injury lawsuit. This includes any court orders that say you must pay alimony and any other records of liens.
Assess the Impact of Your Debts. We calculate how much your spousal support debt affects the money you might get from your lawsuit. Essentially, we need to determine if after paying off the lien, there’ll be sufficient settlement funds left to cover the repayment of your loan.
Talk with Your Attorney. We talk directly with your lawyer to understand better your chances of winning your case and how long it might take. Your attorney’s input helps us assess the risk involved in providing you with funding.
Adjust the Loan Amount: Depending on how much you owe in alimony and the projected settlement, we adjust the funding amount we offer.

Additional Funding Opportunities After Covering Your Spousal Support Lien

When you’ve paid your spousal support lien in full and need more funding, here’s how we evaluate your new application:

Verify Payment of the Lien. You need to provide documentation, such as a court order or official record, confirming that the spousal support lien has been fully paid. Your attorney may also confirm that all spousal support payments are current.
Re-evaluate Your Case. Once we’ve verified that the spousal support lien is paid, we re-evaluate your case. We look at any new developments since your initial funding and settlement projections, which can increase the amount of funding you qualify for.

The Takeaway

Managing financial responsibilities during a personal injury lawsuit isn’t easy, especially when financial reserves start to dwindle. But consider paying off an alimony lien with a lawsuit loan to help you avoid more legal problems, keep your credit score safe, and overall give you more stability.

Applying for a lawsuit loan involves no credit checks or income verification. Contact Baker Street Funding today at (888) 711-3599 to explore how our team can help you get the financing you need to manage your spousal support payments, at no risk.