Financial strain is a common problem for plaintiffs. The stress of medical bills, car repairs, household expenses, and the necessities of everyday life can mean fighting a financial battle along with a legal one. One solution is a lawsuit loan, which they can use to pay bills while they wait for their settlement.
Some common mistakes that plaintiffs make when looking for a lawsuit funding solution:
Borrowing money from a friend or relative. When plaintiffs are in a tough spot financially, it is a natural reaction to look to friends or family for help. While this may work out for some plaintiffs, the sad truth is that borrowing money from a loved one regardless of the reason often results in conflict. Since lawsuits can last for years, the lender may not have realized how long the plaintiff has to wait for a settlement in order to repay them, which often strains the relationship. It is typically best to look for a professional lender so that the plaintiff can keep their financial and personal life healthier.
Using a loan that is repaid through monthly payments. Traditional personal loans are usually repaid through installments. If a plaintiff is looking for lawsuit funding, they are doing so because they are struggling to pay their expenses, but many don’t realize that they may be required to make payments on their personal loan before the lawsuit concludes. That means another monthly expense to worry about. When plaintiffs utilize lawsuit loans, repayment isn’t expected until after the plaintiff receives the settlement.
Relying on credit cards and other similar short-term fixes. When plaintiffs are busy dealing with the details of their lawsuit, they sometimes look right in their wallet for an easy and fast financial solution—credit cards. If a pressing expense can’t wait, it may seem so simple to just take out the credit card. But, as previously stated, the plaintiff can’t be sure when the lawsuit will reach a conclusion, and paying bigger expenses with credit cards is risky regardless of the reason. The longer it takes them to pay it off, the more the interest and fees will build up, and by the time the plaintiff finally receives their settlement, more than expected will be going to the credit card company. The same is true for other fast lending options like paycheck advances: they may be fast, but they’re not convenient for plaintiffs in the long run. If they are interested in settling their finances quickly, then lawsuit loans offer a quick application and funding process.
Letting bills wait. This is another easy trap for plaintiffs to fall into. Many plaintiffs don’t consider any solution at all and instead hope for a fast resolution to their case. This debt that can result from poor financial planning often effects plaintiffs years after the lawsuit is over.
Plaintiffs should be sure to research their options. If they decide that presettlement funding is right for them, then it could prevent falling into these common pitfalls.
About the Author: Steven Medvin is the Executive Director of SMP Advance Funding, LLC, which provides lawsuit funding to individuals who need a lawsuit loan for pending lawsuits. For more information please visit www.smpadvance.com.