Pre-settlement funding is considered a non-recourse loan in that, yes, you have to pay the money back once you receive your settlement. But this is more like an advance on your eventual settlement. This is because how you qualify for legal funding and the terms of the financial agreement differ substantially from the qualification process and the terms of a standard loan.
The Qualification Process
The qualification processes for a traditional loan and pre-settlement legal funding differ quite substantially.
For a personal loan, home mortgage, car loan, or any other type of traditional loan, the amount of money you are eligible to borrow is based on your debt-to-income ratio and your creditworthiness. The lender requires you to provide proof that you’re employed and proof of how much money you make.
They also run a credit check to see how much debt you already have and how well you are paying off that debt. The better you’re doing, the better your credit score. A better credit score can get you a lower interest rate on a loan. A lower score, however, means you may have a higher interest rate.
Your debt-to-income ratio and your credit score will help the lender determine how much money to lend you. The lender also uses your car or your home as collateral. What this means is that, if you can’t pay back the loan, they can sell off your assets to take back the money that you owe them.
In contrast, when it comes to pre-settlement funding, the amount of money you are eligible to receive has absolutely nothing to do with your income, whether you have a job, or your creditworthiness.
To qualify for pre-settlement funding, you must currently be involved in a personal injury case, and you must be represented by a lawyer. The money you can borrow, or the advance you can receive, depends solely on the predicted amount of your eventual settlement.
- NO proof of employment
- NO credit check
- NO supplying financial documents
We draw up an agreement to advance you a portion of the amount we predict you will receive based on industry formulas and other metrics.
For a free legal consultation, call (877) 735-0016
The Payback Process
Another substantial difference between a standard loan and pre-settlement funding is the process of paying the money back. With a standard loan, you have the loan amount (the principal) and the interest amount. You make monthly payments that include both principal and interest.
Also with a traditional loan, the longer the term of the loan, the more interest you pay. And if you have a higher interest rate on that loan, the amount of money you eventually pay back will far exceed the value of the car or house you borrowed the money for. Plus, if you fail to make payments, the lender can seize your car or foreclose on your home. And if that wasn’t bad enough, if they don’t make enough from the sale of your assets to satisfy the loan amount, they can then take you to court for the rest!
Now contrast all of that with pre-settlement funding. Here, your financial agreement is structured entirely differently. What this means for you is:
- NO interest
- NO monthly payments
- NO paying us back if you lose your case
With pre-settlement funding, we cannot go after your assets if you lose your case. This means no selling your home to pay us back or the garnishment of your wages.
We assume that risk when we issue you the funds. All of these terms are spelled out in the financial agreement that you and your lawyer sign. When your case settles and/or you receive a jury award, your lawyer will receive a check from the other party. They pay us back out of those funds, then deduct their legal fees. The remaining money is yours.
Applying Pre-Settlement Funding Is Easy
If pre-settlement funding sounds like the answer to your problems while you wait for your personal injury case to settle, applying is easy. All you need to do is fill out the Apply Now form. Give us a call at (866) 407-6404 if you need assistance.
High Rise Financial processes your application quickly once we have consulted with your personal injury attorney. The approval process may take a couple of days at most. Once we approve your application and you and your attorney have signed the agreement, we will transfer the money into your account within 24-48 hours.
You don’t need to worry about monthly payments like you would with a standard loan, and you don’t have to worry about paying us back until your case settles. The best part of pre-settlement funding is that, if you lose your case, you don’t owe us a dime. So don’t wait – call today!