It is not really a loan. It is a cash advance on an expected settlement. The advance money comes from a lawsuit funding company.
Other details on pre-settlement lawsuit loans
The funding company advances the funds after the claimant has filed a lawsuit.
The funding company makes sure that the case has been filed with the court.
The person that receives the cash advance does not need to repay it, if the defendant wins the court decision.
Drawbacks to consider, before going after a pre-settlement lawsuit loan
Before pursuing such a loan, the plaintiff should speak with his or her attorney. Not all lawyers agree to work for a client that has sought a cash advance from a lawsuit funding company. Understand that any plaintiff that needs money in a hurry should not consider using this approach. It takes time to obtain the requested funds. The lawsuit funding company does a thorough job of studying the nature of the plaintiff’s case. That company does not rush through any examination.
Realize how much money gets given to you, once you are approved. Do not expect to get the entire package, in other words all of the money that the funding company has offered. Your Injury Lawyer in Richmond Hill gets some percentage of the funds in that particular package.
Of course, that does not necessarily mean that your attorney will not seek a contingency fee, if you win your case. It does mean that your attorney gets paid, whether or not you receive any award. Stand prepared to pay back all that you owe, if you do win your case. You will need to give the lawsuit funding company more than the principal. In addition, you must pay the interest, along with any agreed-upon fees. For instance, you will need to reimburse the funding company for the cost of the application fee.
That fact explains the company’s willingness to grant forgiveness of the advanced funds’ repayment, if you do not win your case. It has received the money for the application fee from a large number of customers.
Remember, too, that it always does a thorough job of studying the case for each person that has sought a loan. Consequently, it seldom grants advance funds to someone that does not have a strong case. In other words, there are few times when the recipient of an advance ends up losing his or her case.
Keep all those drawbacks in mind, before you seek one of the available loans. Be sure that you stand prepared to handle any possible outcome. Do not expect to enjoy some sort of windfall, no matter how large an advance you might get offered. It will help to finance your lawsuit.