If you were injured in a car accident or other personal injury accident, and if you filed a personal injury claim to help pay for damages and cover the cost of living expenses while you recover, you may be anxious for your claim to settle. While your anxiety is perfectly normal, do not let it dictate your decision to settle your suit before it is ready to be settled. If you settle prematurely, you risk forfeiting compensation that you not only deserve, but that you need. However, what if you need the money NOW, as that money is necessary to pay your rent or mortgage, to put food on your table, and to cover the cost of medical expenses? Fortunately, you have options outside of settling prematurely. Below are four funding options, including pre-settlement cash advance, and the pros and cons of each.
If you have good credit, you may be able to obtain one or more cards with fairly high credit limits. Credit cards are fairly easy to obtain and can be used pretty much anywhere, from the grocery store to healthcare facilities. Many credit card companies even provide users with a cash advance option. That said, there are a few drawbacks to using credit. For one, you have to pay them off regardless of the outcome of your lawsuit. If you end up losing, you will be stuck with substantial credit card debt and no way to pay it off. Credit cards also typically come with high interest rates and high fees if you pay late or go over the credit limit.
Personal loans are similar to credit cards in that they are easy to get if you have decent credit and you must pay them back within a certain amount of time. However, the interest rates on personal loans are significantly higher than that of normal credit cards, typically around 9 to 11%. The only real benefit of obtaining a personal loan is that, if approved, you get cash right away, sometimes within 24 hours. You can also spend the cash however you would like.
Borrowing money from friends or family may be your best and worst option. On the one hand, if your friends and family have the means, they are more than likely willing to help you out. They are also not likely to charge you interest, which may end up saving you thousands of dollars in the long run. On the other hand, when you borrow from a bank or lender, and if you can not repay said lender, the worst that can happen is you hurt your credit score and the bank may not lend to you in the future. However, if you can not pay a friend or loved one back, you risk damaging your relationship with him or her for good.
Pre-Settlement Cash Advance
Legal funding is probably your safest option. If you qualify for funding, you can receive up to 15% of your anticipated settlement within as little as 24 hours. You are free to use the funds as you please—for medical expenses, monthly bills, food and clothing, etc. If your case settles in your favor, the money loaned to you, plus a small fee, is taken directly from your settlement and repaid to the litigation financing company. If the case settles in the opposition’s favor, however, you are not obligated to repay the money loaned to you.
If you are waiting for your case to go to trial, you may feel pressured to just settle so that you can pay your bills and move on with your life. However, “just settling” may be the worst thing you can do for your physical and financial health. If you truly are strapped for cash, reach out to Capital Financing to learn more about pre-settlement funding and to see if it is right for you. Contact us today to get started.