How Does a Lawsuit Loan Work?

The process of seeing a lawsuit through is rarely brief and financial responsibilities do not take a vacation while you await compensation from your case. Many plaintiffs in personal injury lawsuits experience financial stress as they await the resolution of their case but there are options for relief. Lawsuit loans offer plaintiffs in difficult financial positions the ability to address their financial responsibilities while their lawsuit proceeds.

Anylawsuits.com offers plaintiffs facing financial challenges while awaiting the resolution of a lawsuit funding to help stabilize their situation. Lawsuit loans offered by anylawsuits.com can help financially struggling plaintiffs but often elicit questions regarding what exactly they are and how they work.

What is a Lawsuit Loan?

Lawsuit loans, also known as settlement loans, lawsuit funding, legal funding, pre-settlement funding, or plaintiff funding, are a form of financial support offered to plaintiffs in the midst of active lawsuits.

Put simply, a lawsuit loan is when someone filing a lawsuit borrows money to pay for immediate expenses while they wait for a settlement or case award that they then use to pay back the borrowed money plus interest.

Lawsuit loans are not considered regular loans like the kind usually obtained for a house or a vehicle but instead are non-recourse cash advances on a pending settlement or lawsuit judgment. The lender determines the value of the settlement or court award available from your lawsuit and then offers you a lump sum advance equal to a percentage of that value. The plaintiff gets the money they need soon instead of having to wait months or a year for their case to resolve but they have to pay back the principal which is the amount advanced by the lender as well as a funding fee.

How Much Does a Lawsuit Loan Cost?

Lawsuit funding costs vary from company to company but most of the general practices remain the same across the board. Every lawsuit is different since settlements vary depending on damages and the success of lawyers in negotiations and trials.

Lawsuit loans will typically require the plaintiff to not only pay back the initial amount of cash advance known as the principal but also funding fees that vary from lender to lender. In many cases, funding fees will consist of interest that can run between 2-5% per month. Some lenders may also either add an additional flat fee or only charge a flat funding fee in addition to the cash advance. The details of a lawsuit loan are dependant on the case so it is important to be mindful of what options you have when it comes to funding fees with different lenders.

These funding fees are necessary because lenders take a risk when providing plaintiff funding. Lawsuit loans are non-recourse which means that plaintiffs do not have to pay off their lawsuit loan if they lose their case or fail to get compensation from a settlement.

Who Can Get a Lawsuit Loan?

In order to apply for a lawsuit loan, plaintiffs need to satisfy certain criteria. Most cases do this fairly easily but there are exceptions so review against the following criteria beforehand.

State Eligibility for Lawsuit Loans

Lawsuit loan companies may only provide service to certain states so it is wise to check beforehand whether your state might make you ineligible. Some states may be ineligible for logistical reasons but in many situations, a state’s laws may make lawsuit loans unavailable.

Anylawsuits.com offers plaintiff funding to plaintiffs in all states except Kentucky, Minnesota, Arkansas, and Maryland.

Lawsuits Need to Be Viable for Lenders to Consider Legal Funding

Lenders will typically want to minimize the risk of a lawsuit’s failure so they do not lose money when providing a settlement loan. Attempting to apply for a lawsuit loan with a case that is not viable is an easy way to get denied. You need to have filed a lawsuit in court that is viable to even be considered for a lawsuit loan. While you do have to file a lawsuit, your case does not have to be mid-trial. Most lawsuits are settled out of court and in many cases, this is what lenders anticipate.

Lawsuit Type and Lawsuit Loan Eligibility

You may or may not be eligible for a lawsuit loan depending on the type of lawsuit you have filed. Some lenders only offer plaintiff funding for specific types of cases like motor vehicle accidents or medical malpractice while others accept product liability cases or wrongful death. Check with a prospective lawsuit loan company beforehand to determine if your type of case is eligible.

Anylawsuits.com offers lawsuit loans for the following case types:

Antitrust
Car Accidents
Class Action
Commercial Litigation
Construction
Environmental Harm
Jones Act
Labor Law
Legal Malpractice
Loss of Profits
Medical Malpractice
Patent Infringement
Personal Injury
Premises Liability
Product Liability
Securities Fraud
Slip and Falls
Wrongful Death

Lawsuit Loans Require a Lawyer Attached to the Case

One of the key criteria for acquiring a lawsuit loan is having an attorney. While someone technically can file a lawsuit without a lawyer’s assistance the risk of them getting much less than the value of their case from a settlement or outright losing their case is very high which is a risk no lender will take. Lawyers are also an essential part of the lawsuit loan process because they work directly with a lender in the application process.

Contact Anylawsuits.com About Applying for a Lawsuit Loan

If you have filed a personal injury lawsuit that is months or even years from resolution and are struggling with immediate expenses in the meantime then consider applying for a lawsuit loan through anylawsuits.com.

Personal injuries can affect your ability to work, rack up expensive medical bills, and otherwise put immense stress on your finances while you wait for a settlement. A lawsuit loan from a trustworthy provider like anylawsuits.com can ensure your immediate financial needs are covered so your case can proceed unimpeded.