A Guide to Risk-Free Plaintiff Lending or Legal Funding

When you are hurt or disabled in an accident or workers compensation case, finances are often tight and it takes years to settle or get to court for an award verdict. Insurance companies can also appeal a high verdict or make you wait for your money even after you have won. They also can delay for years before going to court on a case they know will result in a verdict. Even your own lawyer can use as a pressure tactic that you need money, so you may end up settling for less money than you need to pay your bills. In the process, if you are not working or your medical costs are excessive, you may not be able to pay your mortgage. In cases like this, you might want to consider lawsuit funding.

Most lawsuits, in fact about 99 percent of them settle out before going to court. But the insurance company may make you wait until the very last minute. They are relying on that you will get anxious to make a deal or simply that they can keep your money in the bank at a high interest rate.

Lawsuit funding or plaintiff funding is a loan that is at a high interest rate, but the money is available now and you only pay it back if you settle out or win. If you are able to pay from your own finances, it is better to use that first. But if you are about to lose your house, you can't pay your bills and have no more credit extended to you, this is an option to get you through this time period.

The interest rates are high, and they expect to be paid back out of your settlement (even if that means you are not left with any money after paying them back) but it is worth it if you can get the money you need when you need it to keep your house, pay your bills and make sure your kids college plans are not altered by these high medical costs. As high as the rates are, it is not much higher than putting the charges on your credit card and not being able to pay it your credit card bills for several years. Statistically, most cases settle out, but if your case goes to trial, this can extend for years. And if you had a personal injury claim and the lawyer commits malpractice, your expenses go unaddressed for years longer without recourse. If you sue your former lawyer, that lawyer knows exactly what bad financial straits you are in, and can probably wait you out as long as they can.

Even if you qualify for disability or social security disability, this can take months or years to be approved and in the meantime you have no income and mounting medical costs.

This makes plaintiff funding a good option if you need medical treatment you just cannot get on your insurance or pay for (and most serious cases require more physical therapy than the average insurance policy offers) and your case will not settle for years. It is a very expensive way though, to ensure this treatment.

Doing a search online indicates lenders like Oasis Legal Finance will lend you between $1000 and a half million dollars. The interest rate depends on how much you borrow and how long before you settle. For instance borrowing $1000 for 6 months would be at a 1.4 multiplier rate, meaning they would want back $1400. If you borrow that same money for 35 months, the multiplier would be 3.5, so you would owe $3000. If you lost your legal case, you would owe nothing. If you go to court and borrow $1000, the terms would be $1,000 borrowed for 6 months would be $1250, and $1000 for 18 months would be $1400. Compare this to putting your mortgage or other major expense on your credit card for the interest rates and decide if this is a good deal or not for you. Lenders and their interests rate may vary, so check a variety of lenders to see what might work for you.

Before doing this, look into if your credit card offers a reprieve from your bills during a medical emergency . For instance, American Express offers an insurance you can get to not pay your bills for a period of time if you become temporarily disabled. Such a service may help you get by in a tight financial timing much cheaper. It is also better to use your own money to pay off whatever debts you can for as long as possible. But when you run out of options, it may be hard to get any sort of bank loan when you are no longer working and plaintiff lending might be a lifesaver.

Now bear in mind, upon settlement or court verdict, your lawyer customarily gets a third, and you may or may not have to repay your insurance company for the medical bills they have paid, so this loan could mean you come away with nothing or little after your case, but you do have money when you need it.