5 Factors to Consider When Selecting a
Pre-Settlement Funding Lender
The confusion many people experience while waiting for their personal injury claim compensation can feel insurmountable. Injured or not, your bills never stop coming. People wonder how anyone can ride it out.
The good news is you can apply for a car accident loan. This loan is a cash advance to cater to your immediate needs as you wait to receive a civil claim settlement.
What Are the Factors to Consider When Selecting a Pre-Settlement Funding Lender?
While you wait for your accident compensation, approach a pre-settlement funding lender to bail you out financially. Injury settlements are known to take a long time. Selecting the right pre-settlement funding partner can keep your lights on in the meantime. The relationship you establish with the funding partner is long term; therefore, you need to be careful not to shoot yourself in the foot with a poor selection.
The factors you need to consider when selecting the right pre-settlement funding lender include:
1. What Their Interest Rates Are
Carefully review the interest rates in addition to the loan amount. Beware of companies that offer a range of interest rates on an annual basis. Calculating the exact amount you should repay in addition to the loan amount is complex with a range of interest rates.
Find out how they calculate their interest rates. Some charge interest on the principal amount daily, others charge a compounded interest on the principal and the dividends based on a specific duration.
2. Whether They Are the Direct Funders or Brokers
A broker will connect you to the funding opportunity and earn a commission while at it. They do not care whether the funding company has an excellent track record provided they get their commission. Despite this, a broker can become a valuable asset if you’re having trouble securing funds.
If you have to work with a go-between, agree on the terms of engagement beforehand to avoid misunderstanding later. Sometimes, their commission is part of your settlement amount, and you have to pay interest on it. Ask all these questions before deciding whether to work with an intermediary or with the funder directly.
3. Their Terms and Conditions for the Funding
Like any other legal agreement, cement the funding relationship with a contract. Read to understand the terms of the funding agreement before accepting the loan. Your injury lawyer will help you understand the terms and conditions of the deal from a legal perspective.
Look out for an unclear contract as it tells a lot about the indecisiveness of the organization.
4. Whether You Need to Involve Your Attorney
Your attorney is an invaluable asset for your case. As such, involving them in all the steps of the matter is vital. The legal funding company will also need to work with your attorney to determine the strength and potential of your case.
5. The Reputation of the Company
In addition to checking whether the funding company is licensed to do business in your state, check whether they have a good reputation. Companies with a good track record have a structured way of operations, which makes you feel confident enough to work with them. Your lawyer can help you identify which money lenders have a good standing.
Money Lending Firms Make Life in Pain Easier
Money lending firms make the wait for the accident settlement worthwhile. However, conduct your due diligence to know which firm is worth your time and effort before deciding to settle on one. The journey to receiving your accident compensation may be longer than you expect. Having a good funding partner by your side makes the journey possible.