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What are Pre Settlement Funding for? – Know the Basics

Those involved in litigation as plaintiffs should be aware of the availability of the cash advances on pending lawsuits. Plaintiffs do pay their attorneys on a contingency fee basis and in the event that their case qualifying, they will be given a lawsuit loan on their pending lawsuit. The lawsuit loans are as well known as pre settlement funding.

By far and large, there has actually been a lot of misunderstanding on the cash advances on pending lawsuits. Read on in this guide and get some bit of clarity on these and the process at large.

In a broader sense, when we talk of pre settlement funding or lawsuit cash advances, these are generally cash advances that are given to plaintiffs against an anticipated cash award or legal fee. They come with different names and some of the most common ones are pre settlement funding, lawsuit loans and lawsuit lending, all various kinds of legal lending advanced to plaintiffs in a pending litigation.

The one thing that should be as clear, one that some have mistaken, is that these are not to be seen as traditional loans and as such the names given them, lawsuit funding, lawsuit lending, or pre settlement funding and this should be making it as clear that they are mere cash advances against a pending lawsuit. Of course this is a point that is to be noted going forward even considering the fact that with these forms of funding for a lwsuit, there will be no monthly payments, upfront fees and points as we have in the traditional loans. You are not required to pay any fee for the application of the loan save for some of the fees that may be associated with the cash advance you are looking for like the origination and underwriting fees. You are not obliged to pay the advance back in the event that you lose your case. As such they are known as non-recourse loans as you are not under any obligation to repay the advance in the event that you lose the case or the proceeds from the same are less than what is under the terms of the funding contract or agreement.

Actually the pre settlement funding alternative is one that would be a sure alternative for those whose cases may take some few months or where the settlements are likely to be delayed. As such, if you happen to have so exhausted all you financial options to help fund the case at hand to no avail for one way out, then you may be advised to consider applying for the pre settlement funding alternative.
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