For many plaintiffs, getting money to survive while involved in a personal injury lawsuit is a major event of life. Often, victims of accidents find themselves in the unenviable position of being injured due to another person’s negligence. These injuries can leave victims so hurt and helpless preventing them from being able to work.
Mortgage or rent is still due, and the need to continue to pay utilities is unavoidable. You will even be left without electricity or air conditioning in the summer heat, and yet, you have no income.
You could try to borrow money, but no reputable bank or lender is going to be willing to lend you money with no income. You could max out your credit cards, but this would ruin your finances long after your lawsuit against the negligent person has been settled.
If you are like most people, chances are you have never been a party to a lawsuit, let alone had the need to obtain funds in any way necessary.
If you find yourself slipping and wondering how pre-settlement legal funding works, we’ll dive further into explaining pre-settlement legal funding and if credit is a requirement.
Pre-settlement legal funding lenders are not interested in your credit history or score.
If you have never applied for pre-settlement funding (aka a lawsuit loan), there is nothing to freak out about if your credit score is not good. That is because you don’t need good credit to get a lawsuit loan. A credit history and score do not play a role in the ability to qualify for pre-settlement legal funding.
The reason why a credit score won’t matter to a lender when you apply for pre-settlement legal funding is simply because lawsuit loans don’t require a credit check. Pre-settlement legal funding is available to prospective borrowers without regard to creditworthiness and are available fairly fast.
Unlike traditional loans, a pre-settlement legal funding company’s only means of obtaining repayment of the money they lend you is through a successful resolution of your case. That said, your lender will look much harder at your lawsuit than your past track record of repaying loans.
All else equal, the prospective lender will talk to your attorney, examine your case carefully, and won’t pull your credit score when assessing your application for pre-settlement legal funding. Thus, a less-than-perfect credit score does not impede you from being approved for the loan.
The strength of your lawsuit is what matters to a pre-settlement funding lender.
The strength of your lawsuit is what matters to the pre-settlement funding company far more than your credit score. That is why pre-settlement legal funding companies ask for your attorney’s cooperation and pay much closer attention to what they have to say than to your credit score.
A lender that provides you with this type of funding agrees to provide funds to you in return for the right to be repaid when your lawsuit concludes. Your successful recovery in that lawsuit is the only way that the funding company will get repaid. If your lawsuit does not result in a recovery for you, then your lender gets nothing.
Your credit score or history means virtually nothing to a pre-settlement legal funding company.
The fact that you may have successfully paid off your credit card every month going back two decades may be music to the ears of your mortgage banker or an auto finance company, but it is meaningless to a pre-settlement funding lender.
What is your credit score, and why does it matter to other types of lenders?
Your credit score is something almost everyone is familiar with. It is billed as a measure of your creditworthiness or how likely you are to pay back money that is loaned to you.
Credit scores are everything to traditional lenders, who are very risk-averse. They want to ensure they are always guaranteed repayment on any type of loan or financing transaction they make. Therefore, if you have a mortgage or have ever applied for a mortgage or car loan, the lender no doubt pulled your credit as a part of your application.
If you have a good credit score, you will have a better chance of being approved for bank loans at more favorable rates, whereas someone with a low or less than perfect credit score has a much lower chance of being approved for financing or, even if he or she is approved for financing, it is at much higher rates than someone with a good credit score.
Credit 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. A credit score can affect many aspects of your life, so the experts always recommend keeping your credit score as high as possible.
Since a credit score or history does not influence a lawsuit loan application because pre-settlement legal funding is different from other types of loans, lenders that make these types of loans are very specialized and look at different metrics and criteria than your typical mortgage lender or banker.
There is no way for a settlement lender to foreclose on your lawsuit or to repossess anything because they have no legal right to do so.
Ultimately, a pre-settlement legal funding company takes an interest in your lawsuit and hopes it results in a recovery for you, enabling them to be paid back.
If you’re ready to get pre-settlement legal funding, consider the type of finacing that works well with your unique circumstances. Baker Street Funding provides non-recourse legal financing at lower rates than other lenders, asnd with caps. Rate caps protct you from having to pay predatory rates once your case settles.
You can access Baker Street Funding’s application from your desktop or your phone, so you have it at your fingertips. Applying won’t hurt your score at all. The application process takes 24 hours from when your attormey provides your case documentation.
When it comes to pre-settlement legal funding, you don’t have to go it alone. Take advantage of our pre-settlement funding option which do not require a credit check, has low rates — plus they can help you get your finances back on track.