Are Pre-Settlement Funds Loans?

Injuries and accidents can leave you without cash when you need it the most. According to a 2019 AmeriSpeak® Spotlight on Personal Finance survey from NORC at the University of Chicago, over half of American working adults indicated that missing more than one paycheck would mean that they could not cover necessities without accessing savings, and an additional 15 percent would experience hardship after missing two paychecks.

If you were recently injured due to the negligence of another individual or entity, you could be facing financial hardships for several reasons such as:

  • Not being able to return to work
  • Only being able to return to work part-time
  • Having a vehicle totaled in your injury accident
  • Unexpected medical expenses

Options for Dealing with Your Financial Hardship

The good news is that there are several options for dealing with your unexpected financial hardship. One of these options that many injured victims find helpful is to obtain pre-settlement funding. This type of funding can help you bridge the gap between your injury and when you receive your settlement or court award. At USClaims, we offer pre-settlement funding by purchasing some of the expected proceeds from your anticipated injury compensation.

If and when you receive your compensation, whether through a negotiated settlement or a court award, we are paid back for your funding plus any fees and interest.

Is Pre-Settlement Funding a Loan?

Pre-settlement funding has similarities and differences when compared to traditional loans. It is similar to a loan because it accrues interest and requires you to sign documents agreeing to the terms. However, pre-settlement funding is set apart from loans because:

  • You do not make monthly or routine payments
  • It is paid in full when you receive your compensation
  • If you end up not receiving compensation, you do not have to pay the funding back or any interest or fees
  • Your approval does not depend on how much you earn or your credit history
  • You need to be represented by an attorney
  • You must have a valid legal claim

Benefits of Pre-Settlement Funding Over a Typical Loan

There are several benefits to obtaining pre-settlement funding over other types of loans. With traditional loans, you are expected to make monthly payments, which can be quite difficult when you are already struggling financially after an injury. If you default on these payments, your loan will end up in collections and negatively impact your credit score.

Loans can take a long time to approve and fund. With our pre-settlement funding, the application process is quick and easy. Once your loan is approved, you will receive your funds within 24 hours.

With a traditional loan, you must pay the money back, no matter the outcome of your case. If, for some reason, you end up not settling your claim or receiving a court award, you are on the hook to pay the money back anyway. If you are already struggling to make ends meet, doing so can be quite tricky.

If you receive pre-settlement funding, your lawyer will take care of repaying us once they receive compensation on your behalf. They will contact us to determine how much is owed on the loan at that time and send us the money. You do not have to contact us directly or send the money to us. If you receive another type of loan, more often than not, your lawyer will not take care of paying it for you. This can lead to more hassle and can be time-consuming.

Nearly all other types of loans will check your credit score and history to determine your approval. Pre-settlement funding is not determined by these factors but rather the details of your lawsuit. This means you could be more likely to qualify for pre-settlement funding than other loans. Additionally, applying for your funding will not impact your credit score.

Get the Money You Need with USClaims Today

If you are working with an attorney to pursue compensation in your case and your case qualifies, we can get money to you within 24 hours. Alleviating your financial stress only takes a few minutes of your time and can be done in one day. Since you don’t pay us back if you don’t receive compensation, we take the risk and not you.

Don’t wait to learn more about how lawsuit funding can help you. Apply online, or call us at 1-877-USCLAIMS today! Our friendly and knowledgeable representatives are waiting to help you during what is often a stressful and overwhelming time of life.

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