What Should You Know About Personal Injury Funding Options?
If you’ve been hurt in an accident caused by another person’s negligence, you know how significantly it can impact every aspect of your life. Your expenses for medical treatments and other bills may be piling up while you are unable to work due to your injuries. A personal injury claim can help you recover compensation for all the losses you’ve suffered as a result of your accident so you can begin to move forward with your life.
Unfortunately, personal injury settlements can take several months to negotiate or litigate. Many plaintiffs worry about getting through this difficult financial time before they receive their compensation. The anxiety and pressure of mounting bills can sometimes cause victims to settle early for much less than their case is worth. Personal injury funding is one financial option that may help plaintiffs withstand a longer settlement process so they can seek the full compensation they deserve. A knowledgeable settlement funding firm can provide more information on personal injury funding and whether it may be a good choice for your situation.
How Does Settlement Funding for Personal Injury Cases Work?
Settlement funding provides plaintiffs with an advance on their anticipated personal injury claim settlement. After a plaintiff and their lawyer apply for funding, the funding company evaluates the strength of their personal injury case and estimates the value of the expected settlement to determine whether to approve the loan and how much they will offer the applicant. The maximum amount available through settlement funding usually equals 10-20% of the settlement’s total value.
If your funding application is approved, you could receive your money in as little as a few days. In addition to being faster than traditional loans, a major advantage of personal injury funding is that you do not have to make monthly repayments of the amount that was disbursed to you. Instead, your advance plus any applicable fees and interest will be repaid out of your settlement.
In Illinois, settlement funding is regulated by the Illinois Consumer Installment Loan Act, which sets caps on the interest that can be charged. It’s vital to fully understand how the repayment of your personal injury funding will affect the final value of your settlement so you avoid any surprises. Your financing is provided as a non-recourse loan, which means the funding company takes on all the risk associated with the transaction. If you do not win a settlement in your case, you will not be required to repay your loan.
Although utilizing settlement funding can be a helpful strategy for overcoming immediate financial shortfalls while you wait for your case to conclude, it may not be the right choice for everyone. Strong cases with a high probability of recovery are the best candidates for settlement funding. It is important to discuss your situation with your lawyer and an experienced funding company to understand the pros and cons of seeking settlement funding versus pursuing other financial options.
What Types of Personal Injury Cases May Qualify For Funding?
Personal injury funding may be an option in cases where you are trying to recover compensation for losses you’ve incurred from an accident caused by someone else’s negligence. By getting an advance on your settlement payout, you can have cash to pay for living expenses, medical treatments, attorney fees, and other day-to-day bills while your legal team handles your claim. Each settlement funding application is weighed on the merits of the case, but the following varieties of suits are all potentially eligible for personal injury funding:
- Automobile or truck accidents
- Medical malpractice
- Motorcycle accidents
- Pedestrian accidents
- Premises liability
- Product liability
- Workplace accidents
- Wrongful death claims
What Are the Eligibility Requirements For Settlement Funding?
Traditional bank loans have stringent borrower requirements, and applicants must provide proof of employment, submit to credit checks, and meet income standards to qualify. These metrics are generally not applied to settlement funding requests. Instead, approval for settlement funding is based on a thorough examination of the strength of your case and discussions with your lawyer. You must have an active lawsuit in progress and be represented by a certified lawyer to receive consideration for settlement funding.
How Do Pre-Settlement and Post-Settlement Funding Options Differ?
You may apply for personal injury funding either before or after your settlement has been awarded. The timing that is best for you will depend on your financial situation and other factors:
- Pre-settlement funding: If you need funds for expenses while your case is ongoing or require more money to continue pursuing your claim, this type of funding may be appropriate. The amount of the advance can vary widely based on the specifics of the claim.
- Post-settlement funding: Unfortunately, even when you win a lawsuit or reach a settlement, it can take time to receive your compensation. Post-settlement funding can help you bridge the gap between the end of your case and the receipt of your settlement award. It is often much simpler to get approval for post-settlement funding than pre-settlement funding because the case has already been won, and you have a clear idea of the value of your settlement.
How Can an Experienced Settlement Funding Firm Assist You?
There are many factors to consider when deciding whether personal injury funding is right for you. If you are having trouble meeting expenses while waiting for a conclusion to your personal injury case, it is essential to discuss your challenges and options with your lawyer or a trusted settlement funding company. At Blue Fox Funding, LLC, our helpful staff can answer your questions and help you navigate the application process. We provide transparent information on costs, fees, repayment schedules, and more so you can make a confident, well-informed decision. Contact our firm today at (618) 350-4581 to schedule a free funding evaluation.