If you have been involved in an accident and sustained injuries, litigation can be time-consuming.
After months or even years of wrangling, you finally reach a settlement, but accessing your funds could take longer than you expected.
In the worst scenario, you could find an attorney holding your settlement check for months, delaying your access to cash when you need it most.
The timeline for settlement checks is just another hurdle to navigate as you work to resolve your claim. We’ll highlight what to expect in terms of delays so you have a clearer idea of when to expect your settlement check, as well as what causes these delays in the first place.
What Causes Delays with Settlement Checks?
The specifics of your case and settlement agreement mean there is no fixed timeline for the delivery of your settlement check. Some settlements finalize in as little as six weeks, while others drag on for several months before being resolved.
There are many reasons for delays in settlement checks. The following are some of the most common.
The release form is the first document you must sign to get your settlement check. In this form which constitutes a legally binding agreement, you state that you will pursue no further legal action against the defendant for this specific case. Signing this release form is normally a prerequisite for settlement.
Don’t panic if you have concurrent lawsuits against this defendant for a separate matter. Signing this release form for your settlement does not mean you must stop pursuing separate claims.
State on this release form which specific claims you will release the defendant’s insurance company from.
Ensure your attorney checks over this agreement to make certain the terms are fair and reasonable.
Depending on the number of parties involved in your case, you might need to sign several release forms.
While it rarely happens, you might find your settlement check is delayed if the defendant disagrees with the provisions made in the release form. In this event, the release form needs redrafting and re-signing.
The defendant will normally send the settlement check to your attorney. The attorney will typically hold the check in an escrow or trust account until it clears. This usually takes 5 to 7 days for bigger settlement checks.
Your lawyer then deducts the cost of their legal services, as well as paying any outstanding bills and liens on your behalf. When all financial obligations are honored, your attorney sends you a check, either by wire transfer or by mail.
Paying Liens and Bills
Anyone involved in a personal injury case is liable to have outstanding medical bills, sometimes liens, too. It is your legal obligation to settle these bills as soon as your case settles.
As outlined above, your lawyer should make these payments directly from your settlement check before issuing you with the remainder, after legal services are paid for.
Most liens can be settled expediently unless the government has placed a lien against your settlement. When liens involve government-funded programs like Medicaid and Medicare, resolving them can take months.
Most bills related to your case will have a fixed amount, but in some cases your attorney may need to negotiate payment for services like private investigations. This can take time and delay your settlement check being issued. Be patient and it should be in your financial interests.
How About a Structured Settlement Payment?
Occasionally, a defendant might pay via a structured settlement. Where a regular payment sees you paid in full, a structured settlement results in compensation paid over time.
If your case involves a minor, or if there was an especially severe injury requiring ongoing and extensive medical care, you could end up with a structured settlement.
Structured settlements usually involve an annuity being set up for the victim, paid out on a fixed schedule.
When you are faced with the possibility of a structured settlement payout, ask your lawyer to review the terms of the agreement to establish whether this is the optimum deal. Blindly agreeing to a structured settlement without legal consultation could lead to added risk, financial complications, and unexpected delays in your settlement.
Is It Possible to Hasten Delivery of a Settlement Check?
What can you do if you need your settlement check as quickly as possible?
Well, there are some simple ways to speed up this process.
As you near a settlement, draft a release form ahead of time. This agreement will then be in place when required.
After this, start working with your attorney to calculate your bills and liens. You can do this while the defendant is processing the claim release form.
Beyond this, always reply promptly to requests from your lawyer if you’re looking for a streamlined settlement payout.
What can you do if you still find yourself waiting for your settlement check while short of funds for pressing expenses?
Should I Get a Settlement Advance?
Settlement funding goes by many names, including:
- Pre-settlement funding
- Lawsuit loans
- Litigation financing
- Legal cash advance
This form of funding is a cash advance against your expected settlement in exchange for a portion of that settlement. Risk-free, you repay nothing until you settle your case, and you pay nothing at all if you lose your case.
The non-recourse nature of this financing means there is no credit check. You won’t need to provide proof of income or verification of your employment status either.
You can use a lawsuit cash advance for any purpose at all, so you get some valuable breathing space when you need it most.
The downside of this type of litigation financing is the typically high rates of interest, compounding monthly and often mounting substantially if your case takes a long time to settle.
You should only consider a lawsuit loan as a last resort and if you have explored all superior alternatives for financing. As long as you are aware of the potentially high cost of a cash advance, and as long as you borrow only what you need, pre-settlement funding can provide a vital line of funding for those expecting imminent settlement.