Plymouth Motorcycle Accident Case: Taking a Lawsuit Loan

lawsuit loan Plymouth Motorcycle Accident Case: Taking a Lawsuit Loan Plymouth Motorcycle Accident Case: Taking a Lawsuit Loan Image005 4You have a Plymouth motorcycle accident case waiting to be resolved but the lawsuit is taking too long. Just because you got into an accident doesn’t mean the bills won’t stop coming. You have to find a way to support yourself as you await the verdict for your case.

The good news is that you can obtain a lawsuit loan or a lawsuit cash advance. Nowadays there are companies in Plymouth that offer plaintiffs money against anticipated settlement. You do not need to pay back the loan if you lose your lawsuit; at least that’s the case with most companies. On the flipside, you’ll be charged crazy interest rates for your loan. In fact, the interest rates on lawsuit loans is much higher than that of credit card cash advance.

Top Reasons for Taking a Lawsuit Loan

If the injuries from your accident are serious, you might need to take some time away from work to recuperate. In the worst-case scenario, you might not be able to get back to the same job because your injuries left you with a permanent disability.

Lawsuits take a long time to resolve and it might be years before you can finally get compensated. We recently talked about why lawsuits take so long here.

When you have unsuccessfully tried accessing money through other means, taking a lawsuit cash advance may be the only way you will be able to pay your bills and put food on the table. If this is the case for you, then a loan may be the only option you have.

On the other hand, if you are simply taking out a loan to pay for a cruise or some other unimportant luxury, then we wouldn’t recommend it.

Your Lawyer Will Not be Pleased

First, the companies that issue lawsuit loans will require your lawyer to fill out several forms and to present supporting documentation about your case before they can consider processing your loan. This is extra work for your lawyer not to mention that lawyers don’t like it when their clients take out lawsuit loans.

If your lawyer has never handled lawsuit loans before, he may need to do a bit of research regarding the ethics of taking out such a loan before he can fill out the paper work. Most of these companies do not care if their forms have questions that violate legal ethics so if your attorney doesn’t submit the forms within 24 hours, it’s because he is researching these ethical questions.

Your Lawsuit Loan Will Reduce Your Settlement

Many clients discount lawsuit loans when it’s time to settle their case. They tend to have a specific amount in mind as their final settlement amount only to realize that this is not the case. In addition to attorney fees, medical bills and other costs, they have to repay a loan plus interest. These types of clients make it hard to settle a case because they want to hold out for a very high settlement offer. What they don’t realize is that they got paid in part through their lawsuit loan so they should adjust their expectations accordingly.

Pros and Cons of a Lawsuit Loan

Pros

Lawsuit cash advances have two advantages:

If you are unable to cover medical bills, car loan payments, mortgage payments and living expenses during your lawsuit, a lawsuit loan can tide you over or provide much needed breathing space.

Litigation funding allows you more time to consider settlement offers. If you can’t go back to work because of your injuries or you have no source of income, you might become desperate and take any offer. But with a lawsuit loan, you can wait for a fair deal because you will have the funding that you need to take care of your expenses; allowing your lawyer more time to negotiate your case.

Cons of Lawsuit Loans

While they may have their advantages, lawsuit loans may not be the best choice for you.

First, as mentioned earlier, they are expensive. You will have to pay back your lender the initial amount you borrowed plus interest. Your interest payment may be three times the amount you borrowed even if you will not be needed to pay in excess of your settlement award.

Personal injury cases can take years to settle. Interest rates on a typical lawsuit loan can be as high as 60% a year. On a $50, 000 loan, the interest rate can be as high as $30, 000 per year. The interest rates are compounded monthly so if your case takes three years to settle, you’ll have to pay $90, 000 on top of the $50, 000 you borrowed.

Avoiding lawsuit cash advances is the best way forward. Consider borrowing from friends and relatives or use other resources like disability payments or insurance proceeds.

Your Case May Not Qualify for a Loan

A lending company will only lend if it’s sure that you’ll win your case because if you lose your case, you won’t have to pay them back. Also, if you win less than the anticipated amount, you won’t have to repay the entire amount. So it’s only natural that the lender will want to ensure that your case is worth it. Since lenders are very picky, it’s not unusual to hear about plaintiffs having to apply to five or six companies before they find one that wants to loan them money.

Lawsuit Loans are not Regulated Like Other Loans

Since lawsuit loans haven’t been around for a long time, they do not have the same level of regulation that the government has developed for other types of loans. So there are few restrictions on how much these companies can charge for their services. This makes it hard to compare rates and even to pick the best lending company for you.

  • Learn more about the litigation financing industry.

It’s Better to Talk to a Lawyer

If you are strapped for cash, your lawyer can suggest alternative sources of money where you won’t have to repay with crazy amounts of interest. And if the only alternative you have is a lawsuit loan, only take the amount that you need.

Talk to one of our Plymouth motorcycle accident lawyers for a free case evaluation. Call us at 508-746-2700. Or visit our Plymouth offices for a free initial consultation.

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