Personal injury cases take longer than you think to settle. Even if you think you are entirely in the right, insurance companies are fantastic at dragging things out. Generally, this is done to force individuals to take a quick settlement that will get the insurance company off the hook for less than they should owe. If you want to get the time you need without destroying your finances, it may be a good idea to look into personal injury loans.
What They Are
While these loans have a fancy title, you might know them by a much more common name – a cash advance. These loans aren’t a loan like one would get from a bank, but rather much more like a lump sum payment that one might get in exchange for assigning an annuity to another party. These loans are made with the expectation that the individual receiving them will at some point in the future receive a settlement or award in his or her personal injury case.
Who They’re For
As one might expect, these loans are intended for individuals who are involved in personal injury cases. These loans are not just given out to anyone – you absolutely must have some kind of personal injury issue pending. This is because these are absolutely not typical loans – if the plaintiff doesn’t win, he or she doesn’t have to pay back the cash advance. As one might expect, this makes the loans somewhat risky for the provider and quite favorable for those who are willing to sign away a portion of their potential settlement.
Why They Are Needed
These loans are not meant to pay for a new car or to completely replace a settlement. Instead, they are meant to give those who suffer from a personal injury time to pursue their case. While the case might seem like it is open and shut to the plaintiff, the truth is that many personal injury suits take a great deal of time to settle and that costs pile up while this occurs. Rather than settling quickly for a lesser amount, these loans allow the plaintiff to continue living his or her life without compromising his or her case.
When to Get a Loan
There are certain situations in which these loans are very necessary. If you have been injured in a wreck and you find that the other party’s insurance is responding slowly, it may be a good idea to sign away a part of your potential settlement. Likewise, it’s often a good idea to get a loan if you find that the bills mounting around your case make pursuing the case impractical. These are loans that are meant to give you the time you need to pursue action rather than loans that are meant to replace the settlement entirely.
When to Avoid a Loan
The loans are not for everyone who is involved in a personal injury suit. It’s a bad idea to try to take out a loan if your expected settlement is much less than the amount of money that you need to take out. It’s also a bad idea to take out one of these loans if you believe that repaying the advance will take up much of your settlement. These loans should not be taken out if you expect to settle quickly or if you have any ability to live on the money you have in savings. Remember, you are assigning away a part of your settlement when you take this kind of loan, even if your circumstances change in the future.
What to Look For
If you are going to get a personal injury loan, there are at least a few things at which you should look. You want to know the monthly repayment fees, the money transfer fees per transaction, and the fee cap. All three of these criteria will have a great deal of bearing on how much you’ll actually end up paying the loan company in the long run, so make sure you get this information up front. If the loan company isn’t cooperative, you might want to look elsewhere.
Personal injury loans can play a huge role in helping injured people get the time they need to settle their cases. These are cash advances, though, so they do come with a price tag attached. It’s up to you to decide if the money you pay will be worth the peace of mind you get from this type of loan.