According to state law, the individuals who have survived with various injuries due to someone’s negligence or recklessness are eligible in seeking compensation. The monetary damages may include medical bills, lost wages, etc. As sometimes the individuals are unable in covering the costs themselves, they hire experts from the lawsuit funding companies for obtaining the funds. Here are some benefits of this lawsuit funding:
Obtain Fair Result: The lawsuit funding companies can provide you with the time which is essential in obtaining a fair outcome. The compensation offer during the first settlement may not be sufficient for the injured. But the funding companies can definitely alleviate some of the monetary pressure of the injured. The fund from the lawsuit loan firms can be useful for the payment of accumulated bills or child support payments. The injured parties can be amenable for holding settlements they deserve in an amenable way as the pressure is decreased.
No Upfront Fees: No monthly or upfront fees are required to pay for lawsuit funding. Unlike the typical loans or credit card borrowing, this loan does not need monthly payments. The payments are generally made after a successful case settlement.
Win And Pay: The repayment of lawsuit loans is only done when the plaintiff wins the case successfully. The funding companies basically bear the financial burden and when the claimant loses, the amount already provided is considered as gifts to the client.
Verification Not Required: Funding from the lawsuit companies are beneficial as employment verification and credit checks are not required. While taking a loan, the credit history of the applicant will not be a deciding factor. So, for applying a lawsuit funding, you need not worry about the bad credit scores as they will not be an issue at all.
Though there are lots of benefits of lawsuit loans, there are few disadvantages also. Some of them are as follows:
All Cases Not Qualify: As you are not required to repay if you lose the case, the companies are really choosy about the cases. The plaintiffs are only entertained if their cases are anticipated to win. Sometimes, the claimant requires applying in more than five or six companies in order to get the fund.
Expensive Loans: When you are repaying back, you need to repay the principal along with a fixed funding fee. The repayment amount also includes the interest payments which can be double or triple the actual principal amount. Therefore before considering the lawsuit funding, you should look for other sources like disability payments, insurance proceeds or can also borrow from family or friends.
Not Like Other Loans: Introduced way back in 1980, the lawsuit loans are still not regulated like other financial loans. The consumer regulations are not applicable just as they are regulated by the state or federal governments in case of car loans or mortgages. There are a few conditions and restrictions for the amount limit and a few other requirements of interest rates. As there is no regulatory body, it may be difficult for you to choose the funding companies just by depending on their rates.
Difficult To Find Reputable Organization: Without a regulation, it is very difficult to judge whether the companies are treating fairly with the customers or not. If the claimant is unsatisfied with the service, it is very difficult in obtaining a fair justice.
The lawsuit funding companies can provide an immediate financial support to the claimant within 48 hours after the application has been submitted. They basically cover medical expenses, auto payments and mortgage payments. But the claimants can also use the funds wherever it suits the obligations.
Author Bio: Daniel Samuelson is a well known lawsuit funding expert who works in one of the lawsuit loan firms. In this article, he is clearly describing the pros and cons of the lawsuit funding.