If you are caught up in a lawsuit and you are hoping that you will get a settlement to make the process end as quickly as possible, so that you can get your finances and life back on track, you might be considering getting a settlement loan.
Settlement loans are borrowed amounts that match the proceeds which you are expecting to get from a lawsuit. For example, if someone damaged your car and you have great odds of winning the lawsuit against them, but you don’t have the time to wait for the money to repair your car, instead, you can get the settlement loan to do it instantly so that you can keep using your car.
How long do the settlements take?
The time needed to get a settlement can vary based on many different factors, which include the type of injury, medical treatment duration, insurance, number of parties involved in an incident, the country, and the local laws.
The time needed to resolve a settlement can stretch from 1 to 3 years after the accident. When it comes to settlement loans, the longer the process is, the more interest you will have and you will have to pay back more.
Pros of settlement loans
If you need instant cash for the period during your settlement process, this option offers quick access to funds. In case the lawsuit doesn’t end in your favor, you won’t owe anything to the lender. You will have the money to cover your lawyer’s fees, medical bills, and court expenses during the process.
At the same time, you won’t have to ask your lawyer to cover you financially and put him or her and yourself into legal danger. Lawyers can often help you get a better settlement loan as the private loaners have a clear profit with no risk.
Cons of settlement loans
In most cases, the interest rates of settlement loans are around 40%. However, since these are private companies that offer loans, they are usually very open to negotiating the interest.
Getting a large loan might harm you, as the settlement could be decided at a much lower price than you first estimated. This might create a gap in your financial equation.
Settlement loans are a good way to get quick cash for your expenses and medical bills. Even though they aren’t a big risk, it is important to find a reliable lender with a good reputation and to consult your lawyer before getting one.
About Author: The author of this blog is a content marketer who formally worked at Emerging NewsHub 24. A writer by day and a reader by night, he loathes discussing himself in the third person but can be persuaded to do so from time to time.