Matters of law and the subsequent lawsuits can prove to be exhausting and financially draining. If you have a money-related dispute which is up for either settlement or its final hearing is approaching then it is likely that retrieval of the money will be time-consuming and slow.
Such circumstances can result in disastrous consequences since your expenses know no bounds and they will continue to pile up irrespective of the delay caused in the legal proceedings. One confronts a huge dilemma regarding the everyday expenditures. So what is to be done? The answer is Pre-settlement Funding.
The idea of pre-settlement funding
When it comes to defining Pre-settlement Funding, one can describe it as a means for gaining access to money prior to a settlement or the summation of legal processes. The plaintiffs can get hold of the money beforehand thereby enabling themselves to pay for the expenses without any burden. There are various terms which are often used interchangeably with pre-settlement funding like lawsuit advances, third-party consumer litigation financing, non-recourse loans, lawsuit loans, etc. Apart from the above stated details, some key points have been mentioned as follows:
- This type of funding takes place only when plaintiffs are provided with money in advance.
- The cash is issued by a specific company but only in exchange for the profit which is to be gained by the plaintiff once the legal settlement comes to an end.
- Therefore, the company is rendering the plaintiff with money so as to aid him/her in paying bills or for arranging utilities.
- After the case is settled or a verdict is passed, the concerned company will automatically receive their portion as decided earlier.
- Therefore, such funding procedures spare you from the financial crisis in exchange for payments that will be made in the future.
- The plaintiff is required to fulfill the documentation successfully along with all the medical information that is linked to his/her case. Once these are approved, only then one can claim the funding.
- However, if the plaintiff fails to win the case, he/she will not have any debts to clear.
Being cautious is mandatory!
Even though opting for lawsuit advances to elope from the mounting expenses is alluring, it is actually an unclear, confusing and an unwarranted arrangement of funding. Pre-settlement funding is deemed as unregulated in various states. Therefore, one should be highly vigilant while opting for such funding.