Everyone faces financial problems at least once in their lives, especially after an auto accident or other incident caused by someone’s negligence. Personal injury lawsuits can take quite a while to reach a settlement or successful verdict, which leaves injured victims and their families struggling to make ends meet while their claim moves forward. That’s precisely why lawsuit funding—also called pre-settlement funding, lawsuit loans, case loans, or cash advances—is available for many plaintiffs. Despite using the term “loan,” these advances are not actual loans.
What is a Loan?
A loan is lent money that accrues interest. Loans come “secured,” or unsecured,” meaning a secured loan involves collateral and is often involved in mortgages and buying a vehicle. A secured loan means the creditor can assume ownership of the property if the loan isn’t paid. An “unsecured” loan is your typical credit card or another type of line of credit in which the lender or debtor can pursue legal action to recover the balance. Unsecured loans typically include higher interest rates than secured loans. Another term is “credit,” which is a transaction in which a creditor or lender supplies funds and the debtor or recipient agrees to pay it back in the future, typically with interest.
What is a Lawsuit Loan?
Pre-settlement funding or lawsuit loans are often contingent on winning the case. The plaintiff may not need to repay the cash advance if they lose their personal injury claim. However, not all pre-settlement funding companies have that contingency. That’s why it’s essential to do your homework and have your attorney look over your contract before signing for a lawsuit cash advance.
At Legal Capital Corp, we offer modest loans to help plaintiffs cover everyday bills and accumulating medical expenses with a low, capped fee and free online application. The length of time it takes to settle your claim or go through trial proceedings will affect how much you have to pay back of your cash advance.
The difference between a loan and lawsuit funding may seem like semantics, but there are legal implications for these cash advances. Unsecured and secured loans are dictated by the state government’s Department of Banking, which protects debtors from “loan sharks” and disreputable lenders by limiting the amount of interest an institution can charge for loans. Pre-settlement loans aren’t required to follow any restrictions so that lawsuit lenders can charge outrageous interest rates and fees for the cash advance.
The benefits, however, are that you have more options than asking a legal firm for an advance (which is unethical in most states). Many funding options involve lower interest rates than the average line of credit. Plaintiffs often need financial help during the claims process. Lawsuit loans can ease that burden, so you and your family can focus on healing from injuries both physically and psychologically.
Contact Legal Capital Corp About a Lawsuit Loan Today
If you or a loved one is struggling to pay everyday bills and expenses while pursuing a lawsuit, Legal Capital Corp can help. Fill out our online application for free and have cash in hand in as little as 24-48 hours after approval. Or, call us in Chicago today at (312) 204-7939 to learn more.