You may have heard of lawsuit funding buyouts and be wondering what it means, or if it is something that can be beneficial to you. If you have previously received a lawsuit pre-settlement funding from a lawsuit loan company, and now for whatever reason want to take out a new loan with another funding company, this is called a pre-settlement funding buyout. The second company would essentially pay off the loan to the first company, and then give you a new loan with a different interest rate. There are a few reasons why you might choose to do a lawsuit funding buyout.
It’s possible the first financing company you used did not approve you for a high amount, and now you need more money. Or perhaps the rate they gave you is very high, and you want to use a different company with better rates. So you would “refinance” the loan with the second company, thereby starting fresh.
There is an industry practice that is in the best financial interest for most companies to buyout a previous loan when offering a new pre-settlement funding. This is mostly to ensure that they can get paid back when the lawsuit funds come in, and the money doesn’t all go to the first funding company. So a plaintiff cannot have two pre-settlement loans open at the same time.
If you got a cash advance but now are in need of more money, don’t feel stuck. You have options.
Pre-Settlement Cash Advances
Pre-settlement funding is when you have an ongoing personal injury or car accident lawsuit and you would like a cash advance from the future settlement award. Accident victims in the midst of a lawsuit often experience financial difficulties and trouble keeping up with their most basic expenses. A cash advance on your loan will help you pay your medical bills, auto insurance, utilities, and other household expenses. We will help you stay afloat until the money from the lawsuit comes through.
Lawsuit funding companies offer lawsuit loans based on the likelihood of you winning the lawsuit. They will give you an advance on the settlement money when they determine that your case is a good investment. If you were in an auto accident or had a slip and fall and are now pursuing litigation, a lot of your money may be tied up in legal fees or paying medical bills, so you’ll need to borrow against your lawsuit. The amount of money you’ll be approved for depends on a lot of factors, which will be discussed with your lawyer. But ultimately, if you are approved you’ll get a sum of money that is considered a pre-settlement loan, and if you win, the money will go to pay off the loan. If you lose the case, you do not have to repay the loan. So ultimately it is a risk-free loan. When you get a cash advance you can use it for whatever you want or need. There are no rules saying what you can use the money for.
Getting More Than One Pre-Settlement Loan
You might be wondering, how many pre-settlement loans can I get? Many companies will approve you for a pre-settlement loan of up to 50% of the expected settlement amount. But in certain cases you may get more than the initial pre-settlement lawsuit loan amount. Let’s say you get approved for a $10,000 loan and you only choose to take out $5,000 to begin with. At any time you can take out the additional $5,000. Many clients take additional advances when they need it.
Now, if you were approved for a certain limit and you already maxed that out, there are some reasons why additional loans would be approved. For example if new information was discovered in the course of the lawsuit and it turns out you would actually be getting a bigger settlement than previously determined, you can reapply and be approved for an additional loan. Or possibly the first loan amount was determined at the beginning of your case, and in the advanced stage once more facts become clear, a reassessment is needed to determine that you can get an additional loan. In that case, the lawsuit loan funding company will review your application and you could get approved for a higher amount.
If you had a personal injury and are in the midst of a lawsuit, the suit may drag on for 1-3 years and you will be in need of legal funding. There is no reason why you shouldn’t apply for a pre-settlement loan, or to refinance your loan. Even if you were previously denied, if things have changed you may very well get approval.
And if you feel that you need more money and your original funding company isn’t giving it to you, you can approach a different funding company to get a pre-settlement funding buyout. The second company will approach the first company to find out how much you owe and pay off the amount. You will then receive a new loan written up with new terms.
Some reasons you might need to refinance your loan is because you were in desperate need of cash so you took a loan with a high interest rate, and now found a different company offering better rates. But sometimes it may not be in your best interest to refinance your loan especially if it’s been under 6 months. There may be fees associated with paying off the first loan, so be sure to do research before making the decision for a lawsuit funding buyout.
Get Your Pre-Settlement Loans Same Day
Delta Lawsuit loans offers a fast process for accident loans and we offer same day pre-settlement loans. It is a quick process once we have the initial conversation with you, reach out to your lawyer for the details of your case, and you may be approved for settlement advance loans same day or within 24 hours. We offer fast and immediate lawsuit funding as we understand that you need the money now and your personal expenses won’t wait. We don’t do any credit checks or ask for employment history, as that information does not matter when it comes to a pre-settlement loan. The only information we look at is the merit of your case and the determined amount you can expect to receive if your lawyer wins the case. The reason there is no liability on your part in a pre-settlement cash advance loan is because it is not actually a “loan”. It is non-recourse advance loan. This means that you are borrowing against the collateral of your future lawsuit earnings. If you win, we collect the repayment from the settlement amount, and if you lose, you don’t owe us any money back at all.
So if you are in the midst of a personal injury lawsuit and need money now, or if you feel that it is in your best interest to refinance your original loan, don’t hesitate. Call us right away, we can help get you the cash you need, and fast.