Finding The Money To Live On
May Be Next To Impossible
When things are going well for you financially, there never seems to be a shortage of banks or other financial institutions that will lend you money, or provide you with substantial credit limits.
However if your income stops for any reason, including becoming disabled, and you are unable to repay the debt, the same company will often waste no time in turning your account over to a collection agency or to take legal action against you to try to recover their money. Once this process begins, your credit rating may be destroyed and it may be next to impossible for you to find any financial institution that is prepared to help you.
Would your bank lend you money until your lawsuit settles?
Some people are under the impression that if their claim was denied, their bank would come to their financial rescue and lend them the money they need until it is resolved. Unfortunately, even if you have equity to back a loan, because of the uncertainty of repayment due to the timing and outcome of a lawsuit, it is unlikely that your bank would lend you any money. As well, there are restrictions that prohibit banks from lending money to people for an indefinite term, or if there is no guaranteed source to repay the loan. Furthermore, they require precise repayment terms and periodic payments and they typically do not accept the anticipated proceeds from an insurance settlement as collateral for a loan. Even if you did manage to qualify, the amount would not likely be sufficient to cover all of your living expenses until your lawsuit settles.
Can your lawyer lend you any money?
The Canadian and U.S. Bar Associations prohibit or discourage lawyers from lending money to their clients. In some cases, the only cash outlay that a lawyer is permitted to provide to a client is for the expenses (disbursements) related to litigating their case. These restrictions exist to prevent conflicts of interest from arising. For example, if your lawyer were to lend you money, he or she would have a financial stake in your case and you might feel obligated to accept their advice to settle, even if you don't want to.
Are there any private lenders or companies who may be prepared to lend you some money?
There are some private lenders who may be willing to lend you some money under these circumstances, but they typically only lend small amounts and they charge exorbitant fees, or they want a huge portion of your settlement. There are also a growing number of lending agencies known as Lawsuit Funding Companies that provide financial assistance to plaintiffs who have been denied benefits from an insurance company and have commenced legal proceedings. The concept of lawsuit funding was introduced in the United States a number of years ago, and today there are companies located throughout the world that offer this type of financial assistance. However, since the original concept was first developed, almost every company has simply adopted a similar lending model that provides limited financial aid, while charging exorbitant fees. These companies have failed to develop a process or a plan that is unique from the others—or that is focused on the your actual needs, and not on their own financial gain.
Our Solution
We are a justice seeking company with a genuine desire to help you in your pursuit of justice. To accomplish our mission and vision, we have developed a unique strategy called Lawsuit Funding Plus that was designed to help you obtain a more timely and equitable resolution of your lawsuit.
« Previous: Hiring the Right Lawyer
| 1 | 2 | 3
