While most people would prefer not to take any loan, sometimes the need to go for a loan is inevitable. Different lenders offer financial loans for a variety of reasons. Although most people have heard of higher education loans, motor vehicle loans, and house loans, they may have little to no knowledge of a lawsuit loan.
What Is a Lawsuit Loan?
A lawsuit loan is a form of personal loan given to plaintiffs by a reputable lender, such as Money First Lending, in a bid to fund their legal case and meet their daily living expenses. Generally, lawsuit loans are offered to victims of a car injury, work-related injury, or a grievance due to negligence that caused harm. Unlike bank loans, lawsuit loans are provided to plaintiffs as they await the results of their cases.
It’s worth mentioning that unlike most personal loans, the terms of a lawsuit loan solely depend on whether you will win or lose your case. If you manage to win your case, your loan and interest will be repaid through the sum you will receive. The good thing is that if you were to lose, you won’t be held accountable for repaying the loan.
How Does a Lawsuit Loan Work?
As mentioned above, a lawsuit loan is quite unlike any other personal loan. To qualify for one, you must first file for a lawsuit. Only after filing for a case will you be able to file your application for a lawsuit loan from a reputable lending company. However, this is not the end of the process. Once you file for a lawsuit loan, the lending company will have to verify your claim by contacting your lawyer. This step is meant to ascertain whether you suffered an injury and have valid reasons for filing a lawsuit.
Since lawsuit loans are generally “no risk” loans (that means you won’t be held accountable for the loan if you don’t win the case), the lender has to make an in-depth investigation as to whether you have a high chance of winning the case. Due to this, it’s of utmost importance to consult your lawyer before applying for a lawsuit loan. Not only is it a formidable way of keeping your lawyer apprised of your case, but your attorney can scrutinize the terms of the loan and advise you accordingly.
Although going for a lawsuit loan is a good idea, it’s important to remember that you cannot borrow against the entire amount you hope to get. This is because other costs will be covered with the settlement as well. For instance, if you wish to get compensation totaling $100,000, the lending company will factor in your attorney’s fees (which is usually 1/3 of the entire amount) and medical liens. Therefore, the lenders will equate your lawsuit loan to the potential amount you are likely to get after doing away with other related expenses. The good thing is that once the lender approves your loan, you should expect to have the money in your account within 48 hours.
Why You Should Go for a Lawsuit Loan
If you’ve filed for a lawsuit, you probably know the entire process can be quite hectic. Not only do you have to deal with your physical injuries, but your finances will be dwindling fast. The case can even be severe enough where your injuries cannot allow you to look for an income.
Getting the money you need for your court case and daily living expenses can mean the world to you and your loved ones. With such funds, you won’t have to deal with the everyday living hassle. You will have enough time to fight for what you rightfully deserve. It’s for this reason that you should always go for a lawsuit loan.
In a Nutshell
Generally, lawsuit loans are the best way to go, since they offer a lifeline while pursuing your case. Even so, lawsuit loans come with an array of risks such as application fees and high-interest rates. To ensure that you remain on the safer side, always ensure to consult your lawyer before applying for a lawsuit loan.
Laila Azzahra is a professional writer and blogger that loves to write about technology, business, entertainment, science, and health.