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- You can apply for a personal injury case as long as you are represented by a lawyer. The lawyer will send your case details to the settlement lending company. The company’s experts in personal injury cases will review the case, and if they find that the case has potential, they will approve the loan. You have to pay the loan back only after the case is settled. Your lawyer will make two cheques, one for the settlement lending company and one for you.
- The amount of loan that you can receive varies; it is dependent on the expected settlement/judgment’s value. Usually, it is 10 to 15% of the expected amount. It is always recommended that you take only as much amount of money as you really need, even if you are offered a lot of money.
- A personal injury loan is considered as a non-recourse loan. That is, if the case is lost, then the plaintiff will not have to pay the loan back. For the settlement funding company, it will be a complete loss. Hence, the interest rates of personal injury loans are typically higher than rates of commercial loans. It is important that you understand about the interest rates, fees, and about any other hidden rates before you opt for the loan. Also keep in mind that a personal injury case can drag on for months or even years accruing interest.
- Even if you have a bad credit score, you can still get a settlement loan. The only thing that matters for a settlement lending company is the potential of your case.
- Prior to litigation funding, many plaintiffs had to settle their cases for an ‘unfair’ amount because of the fact that the defendants were people or corporate with deep pockets, and they dragged the cases as long as possible to put more financial stress on the plaintiffs. Settlement funding actually helped to level the playing field for the plaintiffs.