Plaintiffs with financial difficulties across the United States take out loans against settlements to support themselves until their cases settle successfully.
In an ideal world, every injured plaintiff would pay off their bills without having to recur to borrowing money. If you’re doing just that, then you don’t have to worry as much about touching your lawsuit settlement for a loan.
But in reality, nearly half of personal injury victims will be considering a loan against their prospected accident settlements due to financial setbacks from their injuries.
Running into a financial brick wall during litigations is a recurring nightmare that has caused many injured plaintiffs to lose sleep while seeking legal redress.
Unfortunately, most people give up and feel pressured to settle for ridiculous out-of-court settlements or low-ball offers from defense attorneys. While that is the cruel reality of most plaintiffs, you can save yourself from the financial stress and strain of protracted litigations by taking a loan on an insurance settlement or court award.
Read on to learn more about loans against lawsuit settlements, the benefits of lawsuit settlement loans, and how to get one.
#1 – Can you take a loan out on a settlement?
Yes. Settlement loan companies like Baker Street Funding allow eligible plaintiffs to obtain non-recourse loans based on the lawsuit settlement value. You can potentially get cash from your settlement early, that is, before your case resolves or before the settlement money arrives.
Personal injury loans on settlements entitle a funding company to repayment only from the payment of a compensation or court award, which the loan is based upon. If you don’t win your case, the lender cannot seize any of your assets to recoup the loan upon default.
Additionally, people have different opinions about these types of loans. Contrary to popular misconceptions and misinformation, loans for settlements are not the same as traditional loans.
Simply put, traditional banks don’t provide loans on ‘future’ settlements due to the high risks of the investment into potential settlement monies. They don’t see your expected monetary compensation as collateral.
#2 – How to get a lawsuit loan.
Hearsays about how legal funding works have prevented plaintiffs from applying for loans for settlements or future verdicts, and the heap of misinformation on the internet is not helping matters.
Before we dive into it, having an attorney on contingency is a prerequisite for consideration; you must also suing someone with insurance.
Check with Baker Street Funding pre-settlement cash advances for around-the-clock customer support and consultations to determine whether your case qualifies for funding.
Here is how to get a loan after a settlement or before your case settles:
To get a cash advance or legal funding for your case, all you need to do is fill out and submit the application form online. Once your application gets through, underwriting will evaluate your application and contact the law firm representing you.
Next, if your case qualifies for evaluation, your attorney must submit relevant documents pertaining to your claim. Once we receive your case file, underwriting (seasoned lawyers) will make a final funding decision within approximately 24 – 48 hours.
Then, if you are good to go, we will notify you of your eligibility, followed by a funding agreement immediately.
To get the final approval of the loan, you and your attorney must sign the funding contract. We will then quickly submit to our investing team for cash release. You will receive the cash advance from your settlement without delay after properly executing the funding agreement.
Depending on how you choose to receive your money, you will get the settlement loan within 2 – 24 hours.
#3 – What are the advantages?
Loans on lawsuit settlements highly benefit personal injury victims every day.
In most accident claims, the settlement payments come from the liable party’s insurance company. Insurers typically delay settlement offers to pressure the injured party to settle for less.
During this duration, cash advances against expected legal settlements are intended to tide plaintiffs over financial commitments.
Loans on future settlements help you cope with your finances while your lawsuit is ongoing. They also give your attorney ample time to build a better case without accepting an unfair offer.
In addition to buying your attorney enough time to build a solid case and negotiate a better offer, lawsuit loans are easier and quicker to get than traditional loans from banks and other lending institutions. You can get approval for pre-settlement funding within 24 hours from when your lawyer provides all required information about your dispute.
Unlike traditional financing institutions, if you’re in a financial hole due to debts due to your injuries, you can get much higher approval amounts when obtaining a loan from your coming settlement. Your other debt has no jurisdiction over how much money you can get since the loan is based solely on the strength of your case.
Unlike traditional loans, you don’t need a good credit score or job history to get your loan application evaluated and approved. And, if you lose your personal injury case, you don’t have to worry about forfeiting your home, vehicle, or any other asset. You are not legally bound to pay back the advance unless you get your settlement check.
Lastly, if your case has settled but the payment is delayed, post-settlement funding (or loans on settlement cases) could help you get through this phase with ease.
#4 – How to choose a settlement loan company.
It is important to understand many settlement loan companies are feigning to be the best lenders in the U.S.
While a handful of such companies are legitimate and transparent in their offers and operations, a lot of them are gimmicks and are only concerned about enriching their pockets. They do so by offering predatory rates that can rise to 100% compounding (which is unethical).
High rates on legal funding will only plunge you into more debt, meaning most of the jury verdict, award, or settlement payout will go into repaying the loan. Not to mention the hidden charges that some of these pre-settlement loan companies ask plaintiffs to pay after the case settles.
You must read the small print and ask questions if you don’t understand the contract.
Don’t sign any funding agreement with rates over 42% a year. And never take a lawsuit loan that doesn’t have capped rates.
#5 – What is the interest rate on a settlement loan?
Pre-settlement funding companies such as Baker Street Funding provide low-interest rates lawsuit loans on pending settlement payments to assist you financially throughout your legal battle.
We also provide loans on accident settlements with capped rates. A capped rate protects you from predatory lending practices by stopping the interest charge in the second or third year from when you take out your last loan. We strike out the risk of rising interest rates over time if your case takes longer than 2 – 3 years to settle. Lower rates allow us to get higher returns while protecting you from predatory rates.
These days, however, it’s not uncommon to see interest rates on settlement loans run between 33% and 100% a year, comparable to bad credit or payday loans. If you take out a $5,000 lawsuit loan from a predatory lender, the interest can cost you $5,000 or more in just one year.
With Baker Street Funding, you can get an advance on a pending settlement with a non-compounding capped rate starting at 2.95% monthly.
You could also get up to 10% of the potential settlement, or between $1,500 up to $2,000,000+ depending on the value of your case.
#6 – How long does it take to get a settlement loan?
Depending on the settlement funding company you are dealing with and how fast your attorney responds when asked to submit the case file for evaluation, you can either get a settlement loan the same day or 24 hours after your attorney fully cooperates with the firm.
In determining your approval time, your most critical responsibility is to ensure your attorney collaborates with the funding company.
If your attorney does not consent or help you through the process, the lender will reject your settlement loan application.
#7 – Can my attorney force me not to get a loan on my settlement case?
Unfortunately, the chances are you have crossed paths with claims that your lawyer can prevent you from getting a loan against a settlement and that it is not possible to get a lawsuit loan without an attorney.
But nothing can be farther from the truth.
Your lawyer cannot and must not prevent you from taking a cash advance to cushion the financial burden of litigations and life expenses because it is unethical. A compassionate attorney will point you to a legitimate settlement lender and guide you on applying without breaking a sweat, but they can’t deny you from getting financial assistance as an advance from your settlement.
#8 – What happens if I lose the case?
As mentioned above, traditional loan institutions obligate you to repay a loan with interest after a stipulated time and on a monthly basis.
However, that is not the case with funding and advance from a settlement. Since advances on settlements are based on the expectation of settlement proceeds before or after the case settles, the repayment is contingent on you winning the litigation.
That means you are not under any legal obligation to repay the pre-funded amount (principal and interest) if judgment swings against you and you don’t get legal compensation.
Also, if the lawsuit recovery is reduced, the pre-settlement funding company may not be able to demand the difference. Instead, they may only lay claim over what is left after you have settled other essential costs like attorney fees and court costs.
#10 – What cases are eligible for funding?
Personal injury cases (where someone is responsible for your injury) such as car accidents, slip and fall are mostly considered for funding. Other types of cases that are deemed eligible for settlement funding include medical malpractice and wrongful death (where someone’s negligence or action caused the death of a loved one.
To find a full list of what we fund, visit our cases we fund page.
If you ever find yourself in lawsuits that involve any of the listed cases above and you are getting strapped for cash, don’t hesitate to consult with your attorney and contact Baker Street Funding for an advance on your anticipated settlement or personal injury award.
When you are caught up in a lawsuit, your pockets may be fast running dry. Medical bills and other living expenses will keep piling up as a result of your injury.
If this is your situation, discuss your concerns with your attorney and ask them to guide you on how to get a cash advance on your prospected financial award or settlement.
While you are at it, bear in mind that you must reside in or near fundable states to qualify for a Baker Street Funding lawsuit loan. And there you have it; we have shared professional tips on how to get the best lawsuit loans.
Thanks to our stress-free application process, Baker Street Funding has made it incredibly easy for plaintiffs to get fast advances against settlements. The process takes between 24 to 48 hours from when your lawyer sends the required information.
If you’re still unsure whether to apply, leverage our free consultation to discuss your case with our team of professional underwriters today. Look into the benefits of Baker Street Funding in just a few minutes.