Can You Get Two Pre-Settlement Loans?
Injury victims who are seeking legal recourse in personal injury cases such as automobile accidents, medical negligence, and product liability may benefit from pre-settlement loans.
Plaintiffs often experience financial difficulties as they recuperate physically and mentally from accidents or the loss of a loved one.
A pre-settlement loan can help you make it through this sensitive point as you go through the lawsuit process. From mortgage payments and ordinary costs of living to expensive medical bills.
How Pre-Settlement Loans Work
A cash advance on your medical negligence settlement is usually limited to 15-20% of the case’s estimated value.
The idea is to get small loans that enable you to keep afloat without threatening to seize the majority of your settlement money.
Many of the expenses incurred during litigation are unanticipated.
If you are unable to work and require continued physical treatment and medical care. As a result, you may need to ask for a cash advance on your upcoming settlement amount.
You are allowed to take out multiple pre-settlement loans, but the overall loan balance (including the prior payout) must not exceed 20% of the lawsuit’s worth.
Because these loans are often deemed “non-recourse funding,” which means you may not have to refund the cash advance if your case is lost, this restriction is designed to safeguard you, the plaintiff, and the lending institution.
Why Would a Second Pre- Settlement Loan Be Necessary?
There is no specific schedule for the end of a trial, and every lawsuit is unique.
As a result, some cases can take months or even years to resolve.
People frequently find themselves in need of additional pre-settlement financing. A few instances of these scenarios are as follows:
- The cost of medical care is rising faster than anticipated.
- More accident-related injuries are being discovered.
- Due to accident injuries, it may be difficult to locate work or work as much as before.
- Unexpected bills that you are unable to pay
- Awaiting approval of disability
How to Get a Pre-Settlement Loan for a Second Time
The majority of legal finance companies will support between 10% and 20% of a potential settlement.
The lender is protected by this limit because the non-recourse nature of the funding already exposes them to risk.
The limit also assures that after all medical liens, legal bills, and pre-settlement funding have been paid off, you will have enough money left over from your payout.
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