12 Questions to Ask Settlement Lenders Before Signing
Trusting somebody with your money comes right after trusting somebody with your life and your health. To believe your Settlement Lender as much you believe your doctor would save you from unnecessary stress and worries that you have to go through while involved in a litigation process.
Many plaintiffs are not aware that they can get an advance of money against their future prospects. A prolonged legal process can take its toll, financially and emotionally. Due to the lack of income and/or inability to work at all, many plaintiffs accept improper offers from insurance companies.
Just because you are out of financial resources that doesn´t mean that the final bell has rung. Today, Settlement Lenders are here for you. Settlement Lenders can help you to overcome your overwhelming financial crisis and give you the strength to keep fighting for justice and your future. Do not hesitate to look for Settlement Lenders when you are in need for cash in order to pay your immediate financial needs, and give your attorney the time they need to fight for the settlement you deserve.
A Settlement Lender will buy rights to a portion of your lawsuit settlement while your case is still pending. The money you receive from a Settlement Lender will be at your disposal in very short period of time.
However, choosing a right Settlement Lender will require some of your time and knowledge. Options, terms and conditions offered by Settlement Lenders are diverse so you should do some research in order to find a trustworthy Settlement Lender.
Use this article to prepare the question list that will help you clarify any ambiguities you might have in regard to Settlement Lenders, their terms and conditions. Follow these twelve (12) questions and learn how Settlement Lending works, what are the conditions of getting funded and what are the terms when it comes to repayment.
Is Your Settlement Lender Broker or Direct Funder?
You want to make sure that your Settlement Lender is direct funder rather than a broker. Even though brokers are helpful when you don´t have time to research the market, they usually add up up to 20% to your fees. Brokers are usually very well informed when it comes to rates, opportunities and other various possibilities that you might take into consideration when you are planning to apply for funds from a Settlement Lender. Nevertheless, any extra cost that is not necessary is not recommendable.
Do not forget that a broker´s job is to merely connect plaintiffs to other Settlement Lenders and to get them to sign a contract. So, ask your Settlement Lender openly if he/she is a Broker or direct Settlement Lender. If you find out that you are dealing with a broker and you are still open to other Settlement Lenders make sure the broker elaborates his/her interest rate in accordance to your future award.
Does Your Lawyer Have to be Included in Your Relation with the Settlement Lender?
Your lawyer is an inevitable link between the Court of Law, you and your case. In addition, the only person who knows more about your case is your lawyer. However, let´s not forget that it all started with you, that you are the one who had to collect all the necessary paperwork in order to file a case, that you are the one who is living the case and knows all about it.
Settlement Lenders don’t require the lawyer to provide all of the case details, however often your lawyer has certain information about your case that they have obtained that you may not have. So, if the settlement lender asks for certain information, make sure you give your attorney the permission to provide all of the information being requested.
In addition, it is crucial that your attorney review the purchase agreement with settlement lender. They are knowledgeable about contracts and can ensure your agreement has your best interest at heart. Most all settlement lenders require your attorney to sign the their portion of the agreement as well. This protects you.
How Soon the Settlement Lender Transfers the Money After You Sign the Contract?
You have decided to go for a cash advance from a Settlement Lender and that means that you should get the funds you need fast, usually without any upfront obligations, credit or background checks.
Settlement Lenders are famous for their ability to deliver money to the person in need fast and without any extra complications. If you are a plaintiff involved in a Civil Court case and need money fast in order to cover your everyday bills, Settlement Lenders will probably satisfy your expectations.
Usually, Settlement Lenders execute money transfer to your bank account within the hours of you signing the contract. Money transfer is the final touch of the Settlement Lender´s expeditious business.
Does Your Advance From Settlement Lender Come with a Compound Interest?
If you are approved for an advance from a Settlement Lender, you need not only know if and when you are going to pay Settlement Lender back, but also what do you need to pay. Do you need to pay back the principle plus compound interest or simple interest?
These are the most important questions when it comes to getting the money so pay attention and make sure you ask the right questions.
Are you obliged to pay the compound interest – compound interest is the interest on the interest. Unlike simple interest, it is not a steady number over the years; Compound interest is interest calculated on the initial principal, which also includes all of the accumulated interests of previous periods of your loan.
Make sure your Settlement Lender explains all about the compound interest if they are applicable to your contract. Knowing your future obligations towards your Settlement Lender will help you organize your future financing.
Does Your Future Loan From Settlement Lender Have a Simple Interest Rate?
Please make sure that this is a question you ask. The interest rate is the amount a Settlement Lender charges for the use of assets expressed as a percentage of the principal.
Simple interest is the interest on the principal. Normally, simple interest is calculated by multiplying the principal, daily interest rate and number of days between the payments.
Simple interest rate is calculated daily. But, if you want to know your monthly simple interest rate you can use a well-known formula A=P (1+rt). Simple interest equation= principle + interest where A stands for Total Accrued Amount (principal +interest), P stands for Principal Amount and rt – r stands for a rate of interest per year in decimal; r=R/100 (R – rate of interest per year as a percent R= r*100) and t stands for time period involved in months or years.
When are You Going to Repay Your Loan to Settlement Lender?
Keep in mind that no two Settlement Lenders are the same. Different companies have different policies. Some Settlement Lenders don´t charge the application fee or any other upfront fees and if you have found a reputable Settlement Lender there wouldn´t be any hidden fees either.
You are going to pay back the original amount plus the agreed interest when you receive a favorable outcome with a verdict or a settlement. Depending on your case type and how far in the litigation process you have come, it might be in three months period or it might take over two years.
So, if your case settles or reaches the final verdict in three months upon your advance from a Settlement Lender you will repay your loan in the amount you have borrowed plus three months’ worth of interest.
What if my Reward is Lower than the Settlement Lender Has Anticipated?
We understand that you are a plaintiff, a person whose future prospects depends on settlement or verdict that is yet to come. A trustworthy Settlement Lender always put an accent on their customers´ needs, current and future once.
If your reward is smaller than you or your Settlement Lender has anticipated you should not worry about it at all. The underwriting team has decided on the amount you should be receiving based on your case file and your eligibility.
If your suit settlement or verdict is smaller than anticipated, the amount you have to repay will never exceed the lesser settlement.
What do I owe Settlement Lender if I Lose the Case?
Unlike a bank loan or line of credit, a cash advance from a reputable Settlement Lender does not require any upfront fees, monthly installments or points.
Throughout your application process you´ve learned that a Settlement Lender does not run a background check, does not require any hard collateral in form of non-liquid assets and that the process itself is fast and straight forward.
A cash advance provided to you by the Settlement Lender is non-recourse and this is it´s best advantage in oppose to the traditional bank loan. Receiving the money from a Settlement Lender is 100% risk free because you are obliged to repay them only if you win the case. If it happens that you lose your case you owe your Settlement Lender nothing.
Ask About Their Background. When did the Settlement Lender Start to Work?
You want to make sure you are dealing with a trustworthy, reputable Settlement Lender and therefore make sure you do your homework right. You have probably undergone vast research when you started to look for a potential Settlement Lender and it is very important that you find a funder that you can rely on.
Always keep in mind that Legal Funding Industry is rapidly growing and some Settlement Lenders are always better than others. You want to make sure that you are dealing with the best funder, the best Settlement Lender that will meet your expectations.
Of course you have searched for references online and asked for your attorney’s advice and opinion but, it is good idea to ask the Settlement Lender about their experience and their background.
Longer experience together with a good reputation is a recipe for successful cooperation.
Ask your Attorney to Review the Contract Prior Signing
It is not a matter of your good or poor judgment but rather a simple view of another pair of eyes.
Very often in life we cannot see things that are right in front of our nose. When we are too involved in the details it happens that we cannot see the forest for the trees.
So, it doesn´t matter if you are having doubts or you need a professional explanation and opinion, or you simply need time to review your contract, ask your Settlement Lender to provide you with the contract draft and take your time studying it. Then ask your attorney to review it as well. Most often they will be required to sign their portion of the agreement so this shouldn’t be an issue.
Learn about all the contact´s elements, mark down any uncertainties you come across and prepare yourself in case you find any discrepancies.
Check the Generalities You Have Agreed On With the Settlement Lender
When you need money fast with as low fuss as possible it is sometimes possible that you miss some general, basic information.
Terms and conditions, interests and rates, possible hidden fees, regulations and numbers are some of the elements of your contract. Keep track about matters and aspects that you have discussed with the Settlement Lender.
It is very important that you note everything that you have discussed and agreed coincides with your written agreement.
Make sure you check and confirm with a Settlement Lender all the generalities in regard to your contact. Have him/her confirm full company´s name, address and telephone number.
Keep in mind that you are dealing with simple mathematics and therefore make sure that everything in regard to interest and rates, your repayment terms and conditions is clear and in order. Together with the Settlement Lender representative, go through every element of your contract in case you need additional information or further explanation.
Ask Settlement Lender for Copy of the Contract
Once your contact is in order and you clear all possible ambiguities, feel free to sign the contract and confirm timeline for the money transfer as we discussed in question number three of this article.
Now that you have means to keep fighting for your rights, you should receive a copy of your fully executed agreement. It is very important that you have it and keep it safe in case any miscalculations in regard to your repayment terms ever occur.
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- No credit checks
- If approved, you can get your cash in 24 hours
- If you lose your case, you owe nothing
- There is no obligation if you apply then decide not to take the funding