Uplift explains how many lawsuit loans you can get and whether you can get funds from multiple companies

Can I Get More than One Pre-Settlement Loan?

Pre-settlement funding can be beneficial for accident injury victims pursuing legal action in  a variety of personal injury claims, including car accidents, product liability, and medical malpractice.

While you can get more than one pre-settlement cash advance, the total value of pre-settlement funding you can obtain is typically pegged to a fixed percentage of the estimated value of your case, normally between 15% and 20%.

This limit is intended to protect both you and the lending company. Pre-settlement funding is a form of non-recourse financing, meaning you do not repay the cash advance unless you win your case.

What Is Pre-Settlement Funding?

Pre-settlement funding is often referred to as lawsuit funding, legal funding, or lawsuit loans.

Despite the name, lawsuit loans are not a loan at all. The ability to receive funding is purely dependent on you being involved in a personal injury case. If this applies, and if you are represented by a lawyer, you are likely to be approved for a lawsuit loan.

This non-recourse financial product is a cash advance, then, rather than a loan. Approval is predicated on the strength of your case, as well as the severity of your injuries, and the extent of your losses and damages. Rather than making monthly payments as you would with a bank loan, instead you repay the cash advance in full if you win your case. If you lose your case, you pay nothing. This is one of the primary reasons for the limit of 20% of settlement value imposed on pre-settlement funding.

You can use the subsequent cash advance for any purpose. Many people taking pre-settlement funding use the cash for:

  • Daily living expenses
  • Groceries
  • Medical treatment
  • Rent or mortgage payments
  • Tuition fees

What Are The Criteria For Lawsuit Loan Applications?

If you are a plaintiff with a lawyer representing your claim for compensation, you are likely eligible for a lawsuit loan.

This type of funding can be useful in personal injury cases, employment disputes, labor law disputes, product liability and medical malpractice lawsuits.

The one inflexible requirement is that you have legal representation. This protects the funding company as a lawyer is unlikely to take on a weak case. This will anyway work to your advantage. Not only will a lawyer help you to achieve a superior settlement, but the contingency nature of legal fees means you pay nothing until you receive your settlement or award.

Why, then, might someone want not just one lawsuit loan but more than one of these cash advances?

Why Would Anyone Need a Second Lawsuit Loan?

There is no fixed timeline for a trial concluding, and all lawsuits are different. This means that some cases can drag on for months or even years.

In many cases, people find themselves looking for additional pre-settlement funding. Some of these scenarios include:

  • Medical bills becoming higher than expected.
  • Discovering additional accident-related injuries.
  • Difficulty finding work or inability to work as much due to accident injuries.
  • Receiving unexpected bills you cannot pay.
  • Waiting on disability approval.

If you are injured in an accident, it can be tough to accurately predict the cost of bills and medical expenses. Situations sometimes change, too. If they do, how can you go about getting an additional lawsuit loan?

How to Take Out a Second Pre-Settlement Loan

Most legal funding companies will fund anywhere from 10% to 20% of an anticipated settlement.

This limit serves to protect the lender, as they are already exposed to risk by the non-recourse nature of this financing. The limit also ensures that you will have enough left from your settlement after all medical liens, legal fees, and pre-settlement funding is paid off.

If you initially borrowed less than this percentage of your expected settlement, your current legal funding company might review your application for an extension on funding. Similarly, if it becomes apparent that you could recover more than initially anticipated, you may be eligible to borrow using revised estimates of your settlement value based on new evidence.

Is It Possible to Obtain an Additional Pre-Settlement Cash Advance From a Different Legal Funding Company?

While it is possible to obtain pre-settlement funding from a different lender, you are not permitted to have multiple legal funding agreements from more than one lender. This means the second lender offers to buy the first loan from your original legal funding company.

What Can You Do If a Lending Company Rejects a Request for Additional Funding?

If the total loan amount requested exceeds 20% of the expected value of your settlement, your request for funding is likely to be denied.

If one funding company rejects your application for funding, you may find another company will offer you a cash advance, but not if the amount exceeds the limits in place.

Repaying a Lawsuit Loan

Lawsuit loans are not like traditional bank loans. Indeed, lawsuit loans are not loans at all. What this means is that you won’t need to worry about payment schedules or penalties for late payment, and you won’t pay anything back until you win your case and receive damages.

Once your case settles, your attorney typically receives your court award or settlement. The law firm pays this check into a trust account until it is cleared by the issuing bank. At this point, legal fees and the amount of any lawsuit loans needs to be deducted from the settlement amount. Your attorney will make these deductions and payments and will then furnish you with the remainder of the settlement.

How to Get a Lawsuit Loan

Fortunately, obtaining pre-settlement funding is straightforward. You won’t need to worry about your credit score, and you won’t need to prove your income or job status either.

The application process is quick and easy, typically paperless and taking as little as 48 hours.

When you first contact a legal funding company, you need only supply the basic facts of your case and the contact information of your attorney. This is the limit of your involvement.

The funding company will then review your case and contact your law firm. Your application will be based entirely on the strength of your claim and your expected settlement value. You can expect funds within as little as a few days. If you then require further pre-settlement funding, you can apply for a second lawsuit loan, as long as your total borrowing falls within the stipulated limits.

Managing Member at Uplift Legal Funding
Jared Stern is an experienced financial professional with six years of experience in the pre-settlement funding industry. After graduating from UC Berkeley with a degree in economics in 2014, Jared began his career in Morgan Stanley's mergers and acquisitions investment banking division. After working with another pre-settlement funding company for two years, Jared founded Uplift Legal Funding in 2017 to give injured plaintiffs a better choice in lawsuit loans. Check Jared out on: LinkedIn | Legal Reader | Attorney At Law Magazine
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