Lawsuit Loan FAQs
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Frequently Asked Questions
When you’re in the middle of an injury claim, or just getting started, you’re likely already getting an overwhelming amount of legalese thrown your way. But you’re not a lawyer; you need answers in plain English. At Provident Legal Funding, our main concern is making justice accessible to everyone. Accessibility starts by making the concepts easy to understand, whether legal or financial.
Waiting for a judgment while recovering from an injury, perhaps unable to work or facing mounting medical bills, can put a major squeeze on your finances. Lawsuit loans are an effective way to bridge that gap; but since providers differ in a number of ways, asking the right questions is crucial to making the right decision. .
We believe in transparency and love helping plaintiffs find out what options are best for them. The following FAQ will help you make an informed decision about pre-settlement funding.
How much do lawsuit loans cost?
This is a key question without an easy answer – but it’s important to understand that there is no debt creation. You’re not getting a loan in the traditional sense, but simply taking an advance on your settlement. That money is essentially already yours. We’re just helping you get some of it sooner.
What really goes into the “cost” of a lawsuit loan is interest. How much you pay in interest depends on the size of principle (the original amount borrowed), the interest rate, and the type of rate. Interest rates vary, even within the same company, but the rate should be fairly low.
At Provident, we offer a “simple interest rate,” which results in a much lower accrued interest than a “compounding interest rate.” With a simple interest rate, interest is accrued as a percentage of the principle (so interest on a $100 advance would be based on a percentage of that $100). But with a compounding interest rate, interest is accrued on the principle plus the accumulated interest from previous pay periods (“interest on interest,” if you will). To keep your cost down, always go with companies that offer simple rates.
Why are lawsuit loans so expensive?
The idea of parting with any of your settlement is daunting. However, so is missing a mortgage payment because you’re out of work. When you compare pre-settlement legal funding to a personal loan, the biggest difference is contingent repayment.
Because legal funding is no-win / no-pay, the legal funding company takes on some of the risk of your case in exchange for providing cash upfront. Not every personal injury claim pans out successfully.
Unfortunately, because some large legal funding companies try to fund as many claims as possible, they have to charge high rates to makeup for losses.
Provident Legal Funding focuses on the merits of each individual case and can often offer much better terms than other pre settlement funding companies.
How do I qualify for a pre-settlement loan?
Qualifying is easy! Simply submit an application and we will go over your case with your lawyer. It has nothing to do with your credit or income records, but the case alone.
Before you submit, there are a few initial qualifications that we require, but they’re fairly simple:
- Are you over the age of 18?
- Have you hired an attorney?
- Have you suffered an injury?
- Is the injury due to the negligence of another party?
If you answered yes to these questions, you are likely to qualify. Otherwise, the risk that you won’t collect is too great and we won’t be able to approve you for a lawsuit loan.
We only accept applications from plaintiffs, so if the liability of the incident is on you, you unfortunately cannot qualify. We look at the settlement amount you are seeking, the likelihood that you will win, and decide how much we will be able to offer you.
Can I get legal funding without a lawyer?
Given the amount of cooperation we need with your legal counsel, we do not approve plaintiffs representing themselves, or those who have yet to hire a legal team. Not only does it make the process much more difficult, but it also raises the risk involved on our part. In order to keep our rates as low as possible, we cannot fund a case with that much uncertainty.
We understand that you may want to have all of your finances taken care of before hiring an attorney, but they play a major part in the lawsuit loan process.
What is the difference between lawsuit loans and real loans?
A very understandable confusion is the difference between lawsuit loans and real loans. In reality, what we offer at Provident isn’t what most people would call a loan — it is an advance on your lawsuit.. The main difference is debt creation.
With a real loan, you are going into debt. That means that the loan is secured against your credit. They’re essentially saying that your history is enough of a guarantee that you will pay it back. While this may sound like a very trusting relationship, it means that they’re simply willing to take a bigger risk. If you don’t pay back the loan, they can repossess your property in order to recoup their losses.
Lawsuit loans are not secured against you at all. If you are unable to pay us back, which would only happen if you lose the suit, then there is no fault against you and you don’t have to pay back the money. You’re not going into debt.
The traditional lender is willing to take a bigger risk because they can charge you more in interest. Because of that, a key difference between the two comes down to price: Lawsuit loans will usually be significantly less expensive.
How much lawsuit funding can I qualify for?
This varies from lender to lender, but generally you can qualify for upwards of $50,000 dollars. It all depends on how much you are seeking for your settlement. We can only offer portion of what you are seeking, as there is always a chance of you settling for much lower. In addition, we don’t want to deplete your entire settlement.
Again, the amount that you qualify for is based entirely on your case, which is why we work so closely with your legal counsel to determine an appropriate amount.
Another factor in determining this is how long the suit is likely to last. If you are trying to cover expenses for a single month, your advance will be low. If it could drag on, you will need to request more funding. Our goal is to leave you with as much of your settlement as possible, but we understand that your bills are likely adding up.
Does Provident provide legal funding on soft tissue injury claims?
Yes. Provident funds negligence cases for virtually any kind of injury, including soft tissue injuries.
What if I lose my case?
That’s always a possibility and it’s the risk we take at Provident. If you lose your case, then you are not required to pay back your advance. That is also the reason we put so much due diligence into reviewing your case and determining its value.
Does Provident really provide 24 hour pre settlement funding?
We understand that time is a factor. You may be in a rush to pay your bills, or even just to feed yourself. Often by the time you get to the courtroom, you may have been out of work for several months. If money is tight, you can’t wait around to get the cash you need.
For that reason, we DO strive every day to get our clients their money within 24 hours. However, to qualify within 24 hours, your lawyer must be responsive and able to get us the requested information. We can only work as fast as your law office.
We work closely with your law firm and have our expert staff expedite the process. That way it’s streamlined and requires little to no effort on your part. All you have to do is apply; we’ll handle the rest.
Personal injury lawsuits put you — as the plaintiff — in a stressful situation. You deserve a funding company that is open, transparent, and easy to understand. We avoid complicated jargon and give you the straight facts. If a lender gives you the runaround when you ask question, that’s a red flag.
We’re here to help you get the money that you need to survive until your case settles. We believe in complete access to justice, and in empowering plaintiffs to get what they deserve from negligent parties. Contact us today to get started, or simply to ask any other questions that you might have. Our staff is ready to help you through the process. Apply online or call us today at (800) 908-6860.
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What Types of Claims Does Provident Fund?
Injured plaintiffs can get car accident loans for instant cash relief before their case is settled or resolved.
Cash advances for medical malpractice lawsuits can help pay medical bills during a drawn-out case
If you are suing for an injury due to poor and faulty conditions of any premises, you might qualify for lawsuit funding
Need money? Pre-settlement funding advances you cash against your assault / battery lawsuit.
FELA accident loans help victims suffering from injuries while they wait for their negligence lawsuit to settle.
Personal injury loans are granted based on the quality of the case and repayment is contingent on settlement. Learn more about personal injury loans here.