What Is a Settlement Advance?
Do you know what a settlement advance is? If your attorney has told you to seek out this type of cash advance on your case, you may want to get more details before doing so. In its most basic form, the settlement advance is an advance of money provided with a fee to the injured person in a case based on the amount of money he or she is likely to get from the settlement of the case in court. If you are injured and are suing a company to pay for the damages, you can work with a financing company that does pre-settlement financing to get funds that you can use to meet your specific needs until your settlement funding comes through.
How It Works
Those that are having trouble meeting their financial needs after being injured and are waiting for a company to pay them for their injury (usually those that are waiting for a case to go to trial and come to a settlement) will be told by their attorney to seek out this type of help from the right company. When they do this, the financing company will first contact their lawyer and request some information from them. During this stage, they are going to determine what the likelihood is for the injured individual to actually receive a settlement from the company. They are also looking at how much they are likely to get as well.
Once they come to this decision, they will then determine the right amount to loan to the individual. If they decide to do so, they will determine the amount based on the estimate of what they are likely to get in a settlement. In addition, there is a fee for using this service. The fee may be just a one time fee or may be a fee based on a monthly schedule if the funds are to be paid back over the course of time. While it is not cheap to get this type of advance, it is often a necessary thing.
The settlement advance is to be paid back when the funds from the settlement come in. If you lose your lawsuit, then you will not have to repay the funds to the lender. If you get a smaller amount in the lawsuit then what was originally estimated, you will not be able to pay anything over the amount that you actually receive in the settlement. Learning what a settlement advance is is not necessarily enough. You should also want to talk to several finance companies to get the best possible product for you.