Why do we even refer to it as a lawsuit loan? It is clearly not a loan in any sense of the word! To be precise, we should refer to it as settlement funding, a form of funding provided in advance of your settling your claim. One may even go so far as to refer to it as venture-capital.
Settlement loans have an advantage, in that they carry no risk for the applicant, hence, the term, “non-recourse.”
The process begins when the lender and applicant strike an agreement. According to the terms of your agreement, if you lose your case, you do not have to repay the loan. Many consider this form of funding, correctly so, as a no-risk type of financial assistance to which you have access while you are awaiting settlement.
Lawsuit loans may be provided for numerous types of cases. It is often instructive to understand not only the types of cases for which settlement funding may be obtained, but also some of the quirks involved with the specific type of case.
Automobile Accident Lawsuit: This is a very common personal injury lawsuit case. They often include medical bills that are difficult to pay. It is not uncommon for these cases to drag on for several years.
Injuries children sustain: Obtaining a pre-settlement loan for these cases is often difficult. History teaches us that, sadly, guardians often pursue a claim to benefit them, without considering the injured child’s interests, creating the need for the Court to appoint an attorney ad litem. The child’s interests may be antithetical to that of the guardian’s, resulting in the attorney ad litem representing the child in an adversarial manner.
Slip-and-Fall: This is the most common type of case. These are cases against which many retailers are taking a very hard stance. It is often necessary to request and obtain video-surveillance of the incident. It is necessary to be very clear regarding the surface on which the slip occurred, obstacles that were present that may have produced the fall, etc. Elicit testimony from witnesses if necessary to support the claim made. Don’t leave details regarding the mechanism of injury to chance.