The Truth About Pre-Settlement Lawsuit Loans

Pre-settlement lawsuit loans are sometimes an immense help to personal injury victims. The loan allows you to take care of your financial obligations while you wait for the lawsuit to be resolved. However, there are certain costs associated with lawsuit loans that you should be aware of. It can be time-consuming and expensive to file a personal injury lawsuit. A pre-settlement loan may be a good option if you urgently need money while you wait for the settlement or verdict.

What is a Pre-settlement Lawsuit Loan?

These are specialized risk-free loans offered by various lenders. They advance money to victims of personal injury that have filed their lawsuits and are waiting for the results. The loan is offered in exchange for a promise that the borrower will repay the loan with applicable costs and interests from the proceeds of the suit.

It is important to understand that the lender generally doesn’t offer the entire amount. For instance, if your personal injury lawsuit is worth $500,000, the lender will give you an estimated value of the case after removing the lawyer’s fee, medical liens, and any other costs. In short, the loan amount will be against that portion of the settlement which the lender conservatively believes you will receive.

Basic Workings of Lawsuit Loans

You need to first file a lawsuit to be eligible for a lawsuit loan. The next step will be to fill out the loan application with a lending company. The lending company will get in touch with your personal injury attorney to evaluate the lawsuit. The lender needs to examine the claim carefully since pre-settlement loans are usually non-recourse loans. This means that you don’t have to repay the loan if you don’t win the lawsuit.

The money is generally provided immediately once the loan is approved by the lender. You can also think of lawsuit loans as the lending company purchasing a portion of your expected settlement proceeds.

Benefits of Pre-settlement Loans

  1. Immediate Funds

The biggest benefit of pre-settlement loans is that it provides immediate money. Often, personal injury victims face mounting legal and medical bills following their accident. They may also suffer strained relationships and depression, which may add to the financial burden. Some victims may find themselves out of work and struggling to meet financial obligations following their injuries. Lawsuit loans can be the lifeline you need in this compromised position.

  1. Zero Risk

Lawsuit loans from reputable lenders are risk-free, which means you only pay back when you recover money from the lawsuit. This is significantly different from traditional loan models in which you are required to pay back the loan in full. In fact, a lot of lenders argue that pre-settlement loans are not technically ‘loans’ since plaintiffs don’t need to repay if they don’t settle or win their case.

  1. Additional Negotiation Time

Personal injury lawsuits usually settle fairly quickly because many injured plaintiffs cannot afford to let a lawsuit drag on. This weakened position is taken advantage of by a well-counseled defendant. They understand that the plaintiff would be tempted to accept even a lowball offer made out of desperation.

Pre-settlement loans are helpful in strengthening the plaintiff’s bargaining position by allowing them to take care of immediate bills. You can always dig in your heels and negotiate for a better settlement. You can also take the lawsuit to trial if required.

Seek a Lawsuit Loan After Careful Consideration

These are some disadvantages and limitations of pre-settlement loans:

  1. Expensive

The biggest drawback of lawsuit loans is that they come with a high attached cost. In some cases, you may find credit card interest to be significantly more generous. This is because of the risk associated with these loans for the lending company. They won’t recover the loan amount and accompanying costs if you don’t settle or win the lawsuit.

  1. Problem Obtaining a Loan

Another limitation of these loans is that you may have trouble getting a loan if your chances of success are not exceptionally high.

  1. Poor Regulation

Most consumer credit loans are regulated by the federal and state government. This is not the case with pre-settlement loans. Interest rates in some cases can be as high as 124% with deceptive or unclear terms.

Things to Keep in Mind

Lawsuit loans offer a financial lifeline which makes them a good option for victims that are hard-pressed for money. However, they come with certain risks which is why it is important to make a well-considered decision. Keep these tips in mind while seeking a pre-settlement loan:

  • Inquire about the application fee
  • Inquire about interest rates
  • Get the loan term in writing
  • Get your attorney involved

Speak With Our Personal Injury Attorneys Before Getting a Lawsuit Loan

It’s easy to get strapped for cash when you have a pending lawsuit. However, you should explore all possible options before getting a pre-settlement loan. It’s recommended that you discuss the terms and conditions with an experienced attorney. The legal team at Stein and Fox Accident Attorneys is here to address your concerns and provide you with the right legal advice. Get in touch with us today by calling at 770-961-1700 or using our online form to set up a free consultation.


Who Is Liable in a Company Carpool Accident?

Determining liability in a company carpool accident can be a difficult task. Depending on the circumstances, the employee who was operating the vehicle at the time of the accident or the employer they work for can be held liable for the accident.

Employer’s Liability in a Company Carpool Accident

Generally, when an employee causes an accident and injures someone as a result of their negligence, the employer can be held financially liable for the resulting injuries and property damage – as long as the employee in question was on the job, acting within the scope of their employment, or was acting under the instructions of their employer at the time of the accident.

The legal doctrine that allows employers to be held vicariously liable for the negligent actions of their employees is called respondeat superior (let the master answer). It emerged in ancient Rome and has since been adopted by many countries – including the United States.

However, there is a notable exception to the doctrine of respondeat superior. Commonly referred to as the ‘coming and going rule’, it exempts employers from being held liable for their employees’ negligent actions – while the employees are coming to work and while they are returning home. In other words, an employer can be held vicariously liable for the actions of their employees only as long as the employees are clocked in.

Employers in Georgia often tend to use the coming and going defense to deny liability for the negligent actions of their employees. However, this defense might not work in a company carpool accident claim under certain circumstances. These include:

  • If the employer designates a particular employee to drive a group of employees to and from work and if they pay the employee an incentive or reward them through any other means, they cannot claim exemption from liability under the coming and going rule, since the coming and going part is also covered under the scope of the employee’s duties.
  • If the employer asks a group of employees to use a company-owned vehicle for carpooling and incentivizes them for doing so, they might not be able to claim an exemption under the coming and going rule.
  • If an employee runs a work-related errand – or runs a personal errand for their employer – while they are coming to work or while they are returning home, and if they cause an accident, the employer can be held liable for the injuries and property damage resulting from the accident.

Employee’s Liability in a Company Carpool Accident

There are certain circumstances where the employer might be able to deny liability for the at-fault employee’s actions using the coming and going exemption. These include:

  • If an employee chooses to drive a group of his coworkers to and from work of their own volition and if they use their own vehicle, they can be personally held liable for any accidents they cause.
  • If a group of employees chooses to carpool to reduce their transportation costs if they take turns to drive the group to and from work every day, and if one of them causes an accident one day, that particular employee can be held liable for their actions.

Why You Need an Experienced Georgia Personal Injury Attorney to Handle a Carpool Accident Claim

When it comes to company carpool accidents, employers almost always tend to deny liability and try to pin the blame entirely on the negligent employee who caused the accident. Only a solid Georgia personal injury attorney can investigate the case and determine who can be held liable.

Moreover, whoever the at-fault party might be, you can be sure that their insurance provider might try to argue that your own negligence contributed to the accident to a certain degree and that you can be partly blamed for what happened. They make this argument knowing that if you are found to be at fault, your compensation will be reduced in proportion to the extent to which your own negligence contributed to the accident.

For instance, if you are found to be at 40% fault, your compensation will be reduced by 40%. If they manage to establish that you were at 50% at fault, you will not be able to receive any compensation. This is why it is extremely important for you to be represented by a skilled Georgia personal injury lawyer who can establish the other party’s liability and help you acquire the settlement you deserve.

Injured in a Company Carpool Accident? Our Georgia Personal Injury Lawyers Can Help You!

If you have been injured in a carpool accident and are not sure who can be held liable, the committed Georgia personal injury attorneys at Stein & Fox can help you. With over 40 years of experience, a first-rate legal team, and a large network of third-party experts, our firm is best suited to handle your claim and can deliver results that most other firms cannot.

To discuss your case with one of our reliable and seasoned Georgia personal injury lawyers, call us today at 770-961-1700 or contact us online and schedule a free consultation.