Can You Get a Settlement Advance From a Lawyer?
Your lawyer has your back. You’ve hired them to represent you in a stressful and important case – and if you’ve made a good decision, your attorney will help you win a sizable settlement and support you along the way.
However, your lawyer has little control over your personal finances, and may not be able to help you if you’re financially struggling. If you need an advance on the settlement you’re anticipating receiving, your lawyer can’t assist you directly – but they may be able to put you in touch with someone who can.
The Problem With Settlements
Filing a lawsuit is the best way to get compensation for your injuries, pain, and suffering, and many clients end up happy with the settled amount. But there’s a big problem with settlements: it takes a long time to see the money.
It can take months or even years for your case to resolve – especially if it ends up going to trial. And even when you reach an agreement, it can take six weeks or longer to get the money. If you’re struggling with ordinary bills and the expenses related to your injury, this length of time can be agonizing.
What Is a Settlement Advance?
One possible workaround to this problem is getting what’s known as a settlement advance. A settlement advance gives you immediate access to capital based on the settlement money you’re going to win in the future. It functions like a loan; you’ll get money from a financial provider right away, and in exchange, you’ll need to pay that money back in the future. Depending on the provider and the nature of the agreement, you might owe compounding interest on the loan, or you might only owe a flat fee.
It’s a convenient way to make ends meet and relieve financial stress while you’re waiting for your settlement to arrive. But can you get it through your lawyer?
Settlement Advance Providers
Unfortunately, your lawyer won’t be able to provide you with a settlement advance. However, they may be able to refer you to a settlement advance provider. A strong recommendation from your lawyer can introduce you to a provider you can trust – so you can feel confident filling out your application, receiving the funds, and paying back the money conveniently when the full settlement comes in.
Important Factors to Consider
A settlement advance can help you financially, but it’s not always the best decision – and it’s not guaranteed to work in your favor in all situations.
Before choosing a settlement advance provider, there are several important factors to consider, including:
- The process. What’s the process you’ll have to follow before receiving your settlement advance? Most providers require you to fill out a short application, providing the details of your case, your lawyer’s information, and other data. But some providers have a lengthier, more challenging process.
- The fees. What are the fees and how are they structured? Many settlement advance providers charge an interest rate on the money you borrow, which will compound over time. By the time you receive your settlement, you may end up owing much more than the original principal – and that amount could grow even more over time. Instead, it’s advisable to seek a settlement advance from a provider that charges a flat fee, so you minimize the extra expenses you face.
- The speed of funding. How soon can you get the money? It’s going to take months or years to receive your settlement normally, so anything faster than that is going to be a good thing – but if you’re having difficulty paying your bills, you need to get the money as soon as possible. Some settlement advance providers can get you the money within a day of your application being approved, and sometimes within hours. Do your research before making a final decision.
- The consequences of a losing case. Even if your case seems promising, there’s a chance you won’t be able to reach a settlement or that your case will lose in court. If this happens, what are the consequences? Settlement advance providers may reject your application if it doesn’t look like you have a good chance of winning. Assuming you’re granted a settlement advance, most providers will not require you to pay back the money if you’re not awarded a settlement – but it pays to be sure.
- The application. Completing the application is usually the easiest part of the process, but it can also be time-consuming. Most settlement advance providers won’t require much information from you – instead, they’ll get in contact with your lawyer, who can provide them with more meaningful details about your case.
- The communication. Do you feel comfortable talking to this settlement advance provider? Can you reach people who are willing and able to answer your questions? Good communication is a sign of a trustworthy company – and can help you get details on all these other questions.
- The reputation. You’ll also want to research the reputation of this settlement advance provider. If you’ve gotten a recommendation from a lawyer you trust, that’s a good start – but you’ll also want to check out reviews from borrowers who have used this service in the past and scope out the company’s reputation overall.
Settlement advances aren’t right for every case or every plaintiff. But if you’re currently struggling to make ends meet and you’re expecting a significant settlement in the near future, it could be in your best interest. Apply for a settlement advance today, or talk to one of our experts for more information!