Getting money to survive while involved in a personal injury lawsuit is a significant life event for many plaintiffs. Often, victims of accidents find themselves in the unenviable position of being injured due to another person’s negligence. These injuries can leave you severely hurt and helpless, preventing you from being able to work and pay your bills. The inability to pay your debt will eventually have a negative impact on your credit history, making it impossible to get traditional financing.
If you find yourself wondering how to get a loan without getting your credit score checked, pre-settlement legal funding is available without regard to creditworthiness.
In this post, we’ll share why pre-settlement legal funding companies do no base their advances on whether you have bad credit, the key differences between traditional loans and why banks do require credit checks.
The reason credit scores do not matter to pre-settlement legal funding companies
Pre-settlement legal funding firms specialize in the legal and finance fields altogether and look at entirely different metrics and criteria than your typical mortgage lender or banker.
A credit score, history, and financial statement do not influence decisions on pre-settlement legal funding applications because they are not a requirement. Lawsuit loan companies provide what is known as non-recourse advances, which means the lender will obtain repayment of the money they lent you through the successful resolution of your case.
So even if your finances are intact, it isn’t very meaningful to pre-settlement legal funding companies. What is actually influential in your application is your case’s merits since the loan repayment comes directly from your attorney out of your settlement or award. This mean your legal dispute is the main factor that can impede or facilitate your pre-settlement legal funding application.
This is the reason why all pre-settlement legal funding companies require you to have an attorney and that they are cooperative with them before evaluating your lawsuit. Your attorney’s cooperation allows them to decide whether you have a solid foundation for your case and your ability to win and pay the money back.
Similarly, if you lose your case and default on the loan, there is no way for a pre-settlement legal funding company to repossess anything you own because they have no legal right to do so. If your suit does not result in a recovery for you, your lender does not get paid, and you get to walk away without paying a dime.
How does pre-settlement funding work?
As mentioned above, when you get a settlement cash advance, a lender agrees to let you borrow money in return for the right to be repaid once the monetary recovery is received. This is why your attorney’s full cooperation is required to show lenders whether your dispute will be adjudicated in your favor.
To get started, you first need to apply for pre-settlement legal funding online or by phone:
- Fill out the funding inquiry form on the website and wait a few hours for pre-qualification.
- Once pre-qualified, a funding team member will immediately contact your personal injury attorney or their paralegal to gather your case documents.
- Once received, underwriting will evaluate your legal matter and provide you with a funding decision 24 hours later.
- Upon approval, you and your attorney will sign the funding agreement before the disbursal of funds.
Traditional lenders and banks
Your credit score is something almost everyone is familiar with. It is billed as a measure of how likely you are to pay back money that is loaned to you. Having a decent credit score (between 670 to 739) is everything to traditional lenders, who are very risk-averse. They want to ensure they are always guaranteed repayment on any type of loan they make. These scores are even used by prospective employers and landlords when screening you if you apply for a new job or to rent a new apartment.
For instance, if you have ever applied for a traditional loan, the lender no doubt pulled your credit as a part of your application. If you have a good payment history, you will have a better chance of being approved for bank loans at more favorable rates. In contrast, a personal injury victim with missed payments and collection notices can barely be approved for conventional financing. Even if approved, it is at much higher rates in extremely low amounts.
The takeaway
If you are like most accident victims, chances are you have never been a party to a lawsuit, let alone had the need to obtain funds in any way necessary. When rent is still due, the need to continue to pay utilities is unavoidable. More often than not, injured victims risk being left without electricity due to little or no income. This leads to burdening financial circumstances with no ability to obtain traditional financing.
Unlike traditional loans, pre-settlement legal funding is much easier to qualify for. No credit checks or financial statement prerequisites are involved in the application process. Since your potential compensation is used as security for the loan, you only need to have a strong case.
If you’re ready to get pre-settlement legal funding, consider a legitimate company that works well with your unique situation. Baker Street Funding’s method of non-recourse financing provides lower rates than other lenders and with caps. Capped rates protect you from having to pay predatory rates once your case is successfully decided. The pre-settlement legal funding process only takes 24 hours from when your attorney provides your case documentation.
Take advantage of our pre-settlement legal funding option—and get your finances back on track.
