In some cases, you can get a loan on a car accident settlement to cover the expenses you face after a crash, before you receive compensation from the at-fault party. However, taking out a loan may not represent the best choice to cover these expenses after a crash.
Instead, you may want to consider car accident litigation funding. You only have to repay this form of funding if you successfully resolve your car accident claim. You can learn more about the benefits of pre-settlement legal funding before you make a decision.
Can You Get a Car Accident Settlement Loan?
Many businesses offer car accident settlement loans to injury victims. These loans may provide emergency funding while going through the legal process, but they have serious drawbacks that you should consider before accepting one.
Instead of taking out a loan that can leave you in a tight financial spot, you may want to consider pre-settlement legal funding as an option to handle your expenses. You can learn more by comparing these options based on:
Applications for Funding
You can apply for pre-settlement legal funding without a credit check. You won’t even have to provide your Social Security card during the application process, unlike what you can expect from a lawsuit loan.
Instead, a pre-settlement funding company will review your legal situation and the facts of your claim, often conducting a conversation with your lawyer. You can secure funding in this manner based on the strength of your claim.
Repayment Regulations
You only have to repay your pre-settlement funding if and when your lawyer successfully resolves your car accident claim, unlike a car accident loan. Loans require repayment regardless of the eventual outcome of your claim, potentially leaving you in a worse financial situation.
Pre-settlement funding qualifies as a non-recourse cash advance, allowing you to maintain your peace of mind while going through the legal process.
What Else Should You Know About Pre-Settlement Funding?
Pre-settlement legal funding can give you the money you need in the aftermath of a motor vehicle accident. Before you apply for this funding, you may want to consider:
The Cost to Apply
You do not have to pay anything to apply for pre-settlement funding. Additionally, you won’t have to worry about third-party or broker fees in some cases, depending on the company you work with to secure funding.
The Availability of the Funds
Once you apply for pre-litigation funding, you can receive the funds you need within a day or two. You will receive all of the funds at once, instead of trickling out over time, so you can cover the expenses you face after an accident.
Who Can Apply
Anyone who sustains injuries in a car accident caused by someone else’s negligence could seek pre-settlement funding while going through the legal system.
For example, you may want to apply after a crash caused by a drunk driver, a distracted driver, or an aggressive driver.
Generally, your lawyer will need to be part of the conversation when you apply for this funding. However, in some situations, you can apply without your lawyer’s approval. Most professionals recommend discussing this decision with your attorney before you take any further steps.
How You Can Use the Funds
You can use the money you receive through pre-lawsuit funding to cover the financial pressures you experience after a crash. For example, you may use this money to pay for your:
- Medical expenses
- Costs of daily living
- Legal fees
These costs may feel overwhelming after a crash, especially if your injuries prevent you from working. Fortunately, you do not have to try to handle them all on your own.
How Repayment Works
Pre-settlement funding provides you with a non-recourse cash advance. You only have to repay the money after the successful resolution of your claim.
Once you resolve your claim, either through a settlement with the insurance company or a verdict in your favor in court, your lawyer will repay the money from the funds you receive from the at-fault party.
Once you’ve repaid the money, the rest of the funds will go to you.
Talk to Us About Securing Funding After a Car Accident
So, can you get a loan on a car accident settlement? While you have this option, many people in your situation decide to secure pre-settlement funding instead of a loan. Our team at Pegasus Legal Capital offers non-recourse legal funding, which means you can get the money you need without a credit check.
Additionally, you only have to pay us back if your lawyer successfully resolves your claim, so you don’t have to worry about future financial hardship.
We want to serve as your trusted legal funding partner, and we have over 15 years of experience that we can use to assist you.
Reach out now to learn more. We’re standing by to answer your questions and guide you through the application process.