Understanding Lawsuit Loans
Las Vegas, Nevada
Lawsuit loans controversy
If you search the Internet, you may find many negative articles about lawsuit loans. Most of the complaints are about ridiculously high interest rates. This article will explain the rationale behind lawsuit loans and how to avoid paying high-interest rates.
What is a lawsuit loan?
A lawsuit loan (sometimes called a pre-settlement loan or post-settlement loan) is a financial arrangement in which a third party provides funds to a plaintiff involved in a lawsuit. These loans are typically used by individuals awaiting a settlement or judgment in a personal injury after a car accident, medical malpractice, or other legal cases.
Lawsuit loans usually provide cash for people awaiting settlement after motor vehicle accidents (e.g., car accidents, truck or semi-truck accidents, pedestrian accidents, and accidents involving Uber or Lyft.)
Non-recourse loans
The lawsuit loans are non-recourse loans, which means - you are under no obligation to repay both principal and interest if your accident liability claim isn't resolved in your favor.
Rates for lawsuit loans
Many people utilize the convenience of lawsuit loans but a few months later are shocked by outrageous interest rates and processing fees. The reason is that most lawsuit loan companies you find online are not licensed in your state and not regulated by the government.
The loan company that doesn't have a license to issue loans in your state can charge any rate they want; the sky is the limit. Some will charge 100 percent on a lawsuit loan and even more.
Tip #1. If you live in Las Vegas or Nevada and want to avoid paying such high interest, always look for a licensed Nevada lawsuit loan company.
Benefits of lawsuit loans
Most people who apply for a lawsuit loan are victims of car accidents. Injuries to a person can have a devastating effect on not only the person's health but also their livelihood. Depending on the seriousness of the trauma, many people are unable to return to work. A lawsuit loan can provide financial relief while your case is pending. You can request a cash advance on your settlement to help with daily living expenses until you can return to work.
Tip #2. Even so, lawsuit loans are not a perfect solution, it is still better to take a loan than to be in a rush and settle your car accident liability claim for less money.
How can lawsuit loans be spent?
Nevada has no particular restrictions on how you can spend the lawsuit loan money. And you don't have to save and show the receipts to anyone.
You can spend your loan on paying your mortgage, rent, medical bills, children's tuition, hiring a babysitter for your child, groceries, or paying credit cards. It is really up to you how you spend your lawsuit loan.
Factors to consider
One major factor to consider when acquiring a loan is the time from when the loan was received to when the individual's case settles. The longer the loan is active, the more you will be required to pay in interest.
What is the maximum amount that I can borrow?
In the legal field, there is no such thing as one size fits all. Everyone's situation is different. Generally, the lawsuit loan amount in Nevada is between 10% and 15% of the expected settlement.
Can I have more than one lawsuit loan?
Yes. There is no limit on the number of pre-settlement loans you can receive.
Tip #3. You can have more than 1 lawsuit loan.
What questions to ask?
When applying for a cash advance loan on your lawsuit in Las Vegas and Nevada, everyone should ask their potential lender a few key questions.
• First, is your company regulated or licensed, and by whom? If a company is not regulated or licensed, it can take advantage of its clients without repercussions. In Nevada, the licensed company can charge up to 40% interest on a lawsuit loan.
• Second, are you a local company? A local company will process your loan much faster. If you were to apply with an out-of-state lawsuit loan company, the application process alone could take days to a few weeks. During this time, many things can change.
• Third, what are your interest rates on lawsuit loans, and how will time affect these rates?
• Lastly, ask what other fees you charge on lawsuit loans. Some companies charge application fees, processing fees, yearly renewal fees, etc.
The more you understand how lenders' interest rates accumulate - the better you can avoid an unexpected chunk missing from your overall settlement.
Tip #4. Nevada has a cap of 40% on the interest on lawsuit loans.
Tip #5. Remember to ask about Additional Fees the lawsuit loan company charges.
Finally
If you are a car accident victim and live in Las Vegas or Nevada, call us at 702-432-1000 to discuss your situation. We can help.
We will work with a lender so you can have a loan contract signed in YOUR best interest for your current situation.
