If you need pre-settlement funding for your lawsuit, it is essential to shop around for the best lawsuit funding rates.
Many legal funding companies offer pre or post-settlement loans and cash advances to plaintiffs in exchange for a portion of their settlement.
In many cases, lawsuit loans help people avoid financial difficulties like foreclosure, eviction, utility shut off, bankruptcy, and debt collection.
However, since pre-settlement loans often cost more than a personal loan from a bank, you should make sure to get the best pre-settlement funding interest rates.
What Are Typical Lawsuit Funding Rates?
Lawsuit funding rates depend on the value of your case and the amount of risk associated with it. Since lending money towards a legal settlement is very high, interest rates are usually higher than a personal loan.
The return for lawsuit loan lenders is contingent on you winning your case, so there’s a chance that they lose their money.
For example, if you pay back a $5,000 lawsuit loan with a monthly interest rate of 3% in six months, the lawsuit loan lender gets $5,900 from your settlement. However, they do not get a full $900 return.
Most lenders have a loss of 8-10% in addition to the money they pay to borrow capital. In the case of the $5,000 loan above, the lender has $300 in costs and $472 in losses. This means that it costs the lender $5,772 to give you the loan. Once you pay back the loan with interest, they only make $128.
For this reason, most pre-settlement funding interest rates are 1-5% monthly.
How Much Will My Funding Cost?
The cost of your funding depends on the value of your case and how much funding you need.
These two factors help a lender determine their lawsuit funding rates.
If your case carries high risk, you may have a higher interest rate.
Are There Any Hidden Fees or Rates?
However, other lawsuit loan lenders may charge additional processing fees for their cash advances.
How to Get the Best Lawsuit Loan Interest Rate
If you want to get the best lawsuit funding rates, you should find a reputable lawsuit loan company that answers your questions upfront.
Here are some ways you can ensure you get the best rate.
Ask the Lender What Their Pre-Settlement Interest Rates Are
It is important to ask every lender what their rates are over the phone or through email.
Advertisements provide a range of rates because the rate often depends on the case.
Get Lawsuit Funding Rates in Writing
When a lender offers you a rate, always ask for the quoted rate in writing.
This will help you shop around for the best interest rate and prevent deceitful lenders from making a false claim on their pre-settlement funding rates.
Get Funding Through Ally Lawsuit Loans Today
At Ally Lawsuit Loans, we make the lawsuit loan application process easy.
We offer the lowest pre-settlement funding interest rates in the industry guaranteed. Most importantly, our funding is risk-free. If you do not win your case, you do not need to pay us back.
We approve applications for funding within 24 hours.
Reviews of Lawsuit Funding Companies
Find the best reviews from around the web of lawsuit loan companies and hear what others have to say about their experience with some lawsuit companies. We have taken an approach to gather some of the best reviews for some lawsuit companies out there.