5 Tips: Settlement Loans & Knowing the Costs
Loans for people with settlements are available for almost all types of lawsuits. In many cases they are referred to as Settlement Loans and offer claimants the ability to access their settlement in advance of distribution. Pre Settlment Funding is the most widely used term to describe the financial transactions. Since the settlements have not yet been determined there is substantial risk that the lawsuit or legal claim may not actually be successful and that the settlement may never materialize.
Most cases have clear liability which means the negligence of the defendant is clear and it should just be a matter of “how much the lawsuit is worth” rather than if the defendant is liable for the accident. Loans for work comp settlements or loans for personal injury settlements are more specific terms to describe Pre Settlment Funding.
Settlement Loans are not actual loans but rather a portion of the settlement is being assigned or transferred to the finance company in exchange for a lawsuit cash payment. As future settlement award is an asset just like a house or car and its’ value allows plaintiffs to “borrow from a lawsuit settlement”.
The demand for loans for people with settlements has grown in proportion with the increase length of time that lawsuits take to settle. The longer that lawsuits take, the more demand their is for people that want to borrow against their settlement. If lawsuits only took 6 months then many claimants could easily wait and would not need a settlement loan.
Loans for people with settlements has grown primarily for those plaintiffs involved in personal injury and worker compensation cases. These people are injured and unable to work. SInce their income has been cut off or reduced substantially, they need cash from their lawsuit to pay bills that are due immediately.
The industry uses many word to describe the financial transaction for loans for people with settlements. They included but are not limited to the following; lawsuit loans, settlement loans, litigation loans, lawsuit funding, pre settlement funding & lawsuit cash. Since the transactions involve a transfer of a future asset to secure the lawsuit cash advance, a settlement loan is not actually a loan.
4 Tips to Lowering the Cost of Your Settlement Loan
Tip #1: Provide all of the facts of your lawsuit that will proved the liability and damages. Complete the application accurately and truthfully. Make sure the funding company clear understands all of your economic and non economic damages related to you case and ultimate settlement value
Tip #2: Medical Treatment. Make sure you document your injuries by continuing to see you physicians with out any “gaps in treatment”. Even if you feel better continue to make your medical appointments so that you injuries are fully documented.
Tip #3: Lawyer. Stick with the lawyer you have chosen through thick and thin if at all possible. Staying with the same personal injury attorney will help your lawsuit gain stability and help hold the valuation. Your lawyer understands your case the best and will most likely extract the largest settlement value possible
Tip #4: Application Amount. The best way to reduce your cost of a settlement loan is too apply for only what you need. The lower amount of loans for people with settlements then the lower the fees will be at distribution of settlement proceeds.
Tip #5: Settlement Loans can bee and excellent way for plaintiffs to borrow against their settlements, however, plaintiffs should take pause when determining the amount they actually want to apply for. Take advantage of a free injury victim checklist here.