Considering Whether or Not to Take a Personal Injury Settlement Advance
Most times, if an attorney takes a personal injury case on contingency there’s a fairly good chance that you at the very least have a strong chance of a favorable decision. No attorney can ever guarantee that a claimant will win his or her case; however, years of knowledge and experience in private practice can help a good personal injury lawyer to know when it is worth it to take a case that has a large amount of promise. Then there’s the reality that personal injury claims can take a very long time to settle. You likely need money now to pay the mortgage and just put some groceries in the refrigerator. Injury settlement cash advances often sound like a good idea, especially to litigants who are only getting started in their cases. Here are a few considerations that should be taken seriously when looking at the advantages and disadvantages of getting an advance on a personal injury settlement claim.
What Happens When You Get Your Settlement Payout
You might need to pay back the funds you get from a personal injury settlement cash advance whether you win your case or not. Then there are also agreements that enable you to walk away and not repay a dime if you don’t come out on top of your cash. In either instance, you have to beware of the interest rates that are due. Cash advances always come at a cost and it is normally the injury victim who pays.
Some Personal Injury Settlement Advance Contracts Have Questionable Clauses
If you believe that you are going to win your personal injury claim and think that you should get a cash advance, don’t make a decision until you have read all the details of the contract agreement. It can be enticing to receive $100,000 cash in your hand right now but what happens when your settlement money comes and you have to hand it all over? There are various companies that will have personal injury victims entering into contracts that require them to sign over their entire settlement checks, even if they are for substantially more than the cash advances they received.
Waiting for Your Settlement Versus Paying High Interest Rates
Make no mistake – if you get a cash advantage on a personal injury settlement claim you are going to lose out on anywhere from 30 to 50% of the total value of your award. High interest rates are to blame for the massive losses that personal injury claimants who opt for advances experience. It can also be quite surprising to realize that the smaller settlement advance that you received months or even years earlier is all that you’re going to get. After compensating your attorney and paying other incidental expenses, there really won’t be much left after you factor in the large payment that is due to the personal injury settlement company.
Everyone has living costs and if you have been hurt in an accident you might not be able to pay your own way for a while. If you have an attorney and you are actively pursuing legal action, it might be worth the wait in the end. Taking a cash advance of any sort can be costly so see what option will be best for you in the end.