If you file a personal injury lawsuit, you might wait for more than two years to get your money. Unless you have a healthy bank account, such a long wait might make life difficult for you. Fortunately, you can get lawsuit loans for your immediate financial needs as you await the settlement check. Below are some of the pros and cons of these loans.
Here are some of the reasons to consider lawsuit loans.
Many people need immediate money after an injury. Even if the relevant insurance companies pay your medical bills, you also have other expenses, such as:
Property damage repair
Babysitter fees if you can't take care of your child
Domestic helper expenses if you can't do your normal chores
Moreover, you might be out of work for a long time due to your injury. The lawsuit loan may be the best source of immediate funds.
Lawsuit loans carry relatively low risks. According to nolo.com, you only repair your lawsuit loan if you win your case and get the settlement money. In addition, your repayment won't exceed your award if the award is less than the loan.
For example, if you took a lawsuit loan of $100,000 but your lawsuit only nets you $75,000. The lender won't force you to pay more than the $75,000.
Personal injury negotiation is not easy. The negotiation will be even more complicated if you are also thinking about your immediate financial needs. A lawsuit loan frees you from such worry so that you can focus on your case.
Here are the drawbacks to consider before taking a lawsuit loan.
The law risks of lawsuit loans mean lenders have to be extra careful with whom they loan. You only qualify for the loan if you have a strong case. A lender will only consider your application if they are convinced you are likely to win.
As mentioned above, the financier will only get their money back if you win your case. That is a very high risk from the lender's point of view. Many lenders charge high rates to protect themselves from those high risks.
Complicated Terms and Conditions
The government doesn't regulate the lawsuit loan industry as tightly as it does other financial issues. Thus, the requirements, terms, and disclosure of a lawsuit loan can be complex and difficult to grasp by an average person.
Injury lawsuit loans have their pros and cons. If you are considering this for yourself, seek the help of a personal injury lawyer.
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