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Most people first think of their local bank or credit union when they need to borrow money. These are the institutions we typically count on for mortgages, car loans, or lines of credit. For these traditional loan products, a traditional lender makes sense.
However, a settlement loan (also called legal funding or lawsuit financing) is not technically a loan. It’s an agreement that lets you spend money you expect to get from a personal injury lawsuit before your case settles. Even though banks don’t offer pre-settlement funding, you can turn to a reputable lawsuit funding company like High Rise Financial.
What Is Pre-Settlement Funding?
As you know, by suing someone following an accident, you are seeking financial compensation for your losses. The defendant in your claim, typically through their lawyer, might offer you money to avoid going to trial. Once both sides reach an agreement regarding fair compensation, you would accept their offer and finalize the suit.
Pre-settlement funding is money you apply for before your suit concludes and while you’re still negotiating your compensation. These funds typically come from a third party who holds no interest in either side’s claim.
With pre-settlement funding, you might be able to receive up to 20% of your anticipated compensation today rather than waiting months or years for a resolution. It equates to early access to your money which will be paid back out of your eventual settlement.
To apply for free, call (877) 735-0016
Pre-Settlement Funding Is Different Than a Bank Loan
Bank loans and pre-settlement financing are entirely different products; however, they can both help you stay financially solvent during a drawn-out court battle.
While a traditional loan may help one person acquire money during a lawsuit negotiation, pre-settlement funding may work better for others. What’s best for you? Consider the following distinctions to decide:
Eligibility Determination
A bank can only approve your loan once it’s convinced thoroughly you’ll have the means to return their borrowed money. Bank underwriters will scrutinize your bank statements, assets, income, and credit history. If you come up short fiscally, they will decline your application or require a creditworthy cosigner to join you on the loan application.
Conversely, pre-settlement loans do not require personal guarantees or perfect credit scores. Instead, you may qualify based on your claim’s merits and the compensation amount you’re likely to receive. To be eligible for pre-settlement funding, you will need:
- To be the plaintiff in a personal injury lawsuit
- An attorney who represents you on contingency, which means they charge no upfront fees and are only compensated if you win
- An attorney who supports your decision to seek pre-settlement funding
- An attorney who is responsive when asked to discuss your case and will share supporting documents with the financing company
- An attorney who agrees to repay the funds plus applicable fees out of the settlement they receive on your behalf
- A defendant who is clearly at fault for your injuries and has the financial means to compensate you
Recourse vs. Non-Recourse Debt
A bank loan is considered recourse debt. This means the lender has the right to pursue its money if you fail to make the agreed-upon payments. The bank may send your account to collections, garnish your wages through small claims court, or seize any assets that you put up as collateral.
A pre-settlement loan, on the other hand, is a type of non-recourse debt. The company that advanced the funds can only get their money back if you win your case. If you lose and receive no settlement, they have no recourse by which to recover the funds.
Funding Timeline
Bank underwriters must thoroughly scrutinize your application and financial strength; therefore, it can take a week or more to receive approval and funding. Unfortunately, this timeframe won’t work for someone with mounting medical bills who may be unable to work because of their injuries.
With no credit checks or deep dives into your personal finances, pre-settlement financing can often deliver faster funding than traditional banks. Your application can be approved in hours, with cash in your account as soon as the next business day.
How to Access Money From Your Legal Settlement
Even though your bank can’t loan money against your future compensation, you can receive the funds you need now to pay bills or make necessary purchases. The first step is choosing a reputable lawsuit financing company that you can trust: High Rise Financial. Then, all you’ll need to do is:
- Discuss pre-settlement funding with your attorney: Since you can only get approved for financing if your attorney is on board, it’s a smart idea to discuss your intentions before applying.
- Fill out an application: Complete a brief form where you can give details about your case and contact information for both yourself and your attorney.
- Wait for the funding company to evaluate your case: After verifying your info and talking to your attorney, we will evaluate your lawsuit and determine whether you qualify for funding.
- Sign the contract: If you qualify, we will draw up a contract that outlines the amount you’ll receive and any relevant fees that are owed. You and your attorney will both sign this document.
- Receive your funds: Once you agree to the contract terms, the money will be deposited directly into your bank account to be available within hours.
Contact Us Today to See If You Qualify for Legal Funding
Bank loans can be challenging to obtain because of their stringent qualification requirements. Plus, if you lose your case, you would still be required to pay the money back. Pre-settlement funding has no pre-qualification, and if you lose your case, you owe us nothing.
However, it’s not offered by any bank or credit union.
Thankfully, High Rise Financial is here to help you access the funds you need now. Not sure whether you qualify for a pre-settlement loan? Contact us immediately to discuss your case.
Call or text (877) 735-0016 or fill out our form to apply today for free.