Can You Borrow Money From a Pending Lawsuit?
When you are dealing with a lawsuit, it can be a stressful and uncertain time. And during this time, plaintiffs are often facing financial difficulties. Legal proceedings can take months or even years to resolve, which causes many plaintiffs to ask if it is possible to borrow money from a pending lawsuit.
The short answer to this question is, “yes”. You can borrow money from a pending lawsuit, but you must be working with an attorney who can verify that you have a strong case. Lawsuit settlement loans are not given out through a bank, however. You need to go through a reputable lawsuit funding company to borrow money for this purpose.
Phases of a Lawsuit
Before we discuss how to borrow money against a pending lawsuit, it is important to take a step back and look at how litigation works. A lawsuit typically goes through several phases, each with its own set of legal procedures and requirements.
The specific phases of a lawsuit can vary depending on the jurisdiction and the type of case, but they generally include the following:
- Pre-litigation: This is the period before a lawsuit is filed when the parties attempt to resolve the dispute through negotiations or alternative dispute resolution methods. If the parties are unable to reach a resolution, a lawsuit may be filed. This is the phase in which many plaintiffs start searching for ways to borrow money from their pending lawsuits.
- Filing and Service of Process: This is the stage when the complaint is filed with the court and the defendant is formally notified of the lawsuit. This is also commonly known as the “summons and complaint” stage.
- Discovery: This is the stage where both parties exchange information and gather evidence to support their respective positions. This may include the exchange of documents, taking depositions, and other methods of obtaining information.
- Motions: In this stage, either party may file motions to the court, such as a motion to dismiss or a motion for summary judgment. These motions can sometimes determine the outcome of the case before trial.
- Trial: If the case has not been resolved through settlement or motions, a trial may be held to determine the outcome of the case.
- Appeal: If either party is dissatisfied with the outcome of the trial, they may file an appeal to a higher court.
It is important to note that the vast majority (more than 90%) of civil lawsuits are settled before they ever go to trial. But many cases are not resolved during the pre-litigation stage either. Sometimes, defendants do not make a reasonable offer until they know that the plaintiff is serious about going to court, and there have been countless instances in which cases have been settled literally “on the steps of the courthouse”.
If you are a plaintiff who is experiencing financial difficulties, you most likely want to get the case settled and get your money ASAP. But you must understand that the initial offer you receive is likely to be far lower than what your case is worth.
Your lawyer may need to file a lawsuit and go through discovery in order to bring the other side to the table, and as we talked about earlier, this could mean waiting for several months before you get your money. This is where pre-settlement funding can provide you with the funds you need to bridge the financial gap.
How Does Lawsuit Funding Work?
As we touched on earlier, plaintiffs who want to borrow money against a pending lawsuit will need to go through a reputable lawsuit funding provider. This type of financing is different from conventional bank loans in some very significant ways.
The most important difference is that lawsuit settlement loans are non-recourse. This means that the plaintiff pays back the loan from the proceeds of the settlement; and if for whatever reason, the case does not go their way and they fail to recover compensation, the plaintiff does not have to pay back the loan at all.
Because pre-settlement loans are nonrecourse, there is no collateral required, and there are no credit checks needed in order for plaintiffs to qualify. All that is required is that you have a pending lawsuit and that you are working with an attorney. There is also no need for the plaintiff to make monthly payments because again, the loan is only paid back from the proceeds of the lawsuit.
Here are the main steps to securing a lawsuit advance:
- Submit an Application Submit a pre-settlement loan application with information about your lawsuit, how much you want to apply for, and how to get in touch with your attorney.
- We Evaluate Your Application Our underwriters will evaluate your pre-settlement funding application and the potential for recovering compensation from your lawsuit. This will include a discussion of your claim with your attorney.
- Approval and Funding If our underwriters determine that there is a strong likelihood of recovering compensation, you will be approved, and your pre-settlement loan will be funded. The amount that you can borrow against your pending lawsuit will depend on the settlement you are expecting to receive and other details of your case. Once approved, funds will be sent to your bank account within hours.
Need to Borrow Money from a Pending Lawsuit? Contact Direct Legal Funding Today!
Whether you are waiting for funds from a car accident, truck accident, motorcycle accident, wrongful death claim, or virtually any other type of civil lawsuit, Direct Legal Funding is here to help! We know that many plaintiffs face the dilemma of needing their money right away but not wanting to accept an insultingly low settlement offer from the defendant.
With a lawsuit cash advance from Direct Legal Funding, you can get the money you need to tie you over until your case is settled. This allows your attorney to pursue your claim from a position of strength knowing that they can take the case all the way to trial if necessary in order to recover full and fair compensation for your losses.
Call us today at 866-941-5588 or send us a message here to get started.