In truth the Lawsuit Loan is not a loan but an advance fee, "special fund" & form of venture capital. It is used in reference to a form of pre-settlement lawsuit funding. For instance, the plaintiff in a personal injury case who seeks to obtain a cash advance against the verdict or settlement in a lawsuit will not ordinarily be offered a loan, but will instead be offered "no recourse lawsuit funding".
The obvious advantage of this financing fund is no risk for plaintiff to take this lawsuit financing. If the lawsuit resolves for less than the amount of the cash advance, or if the defendant ultimately prevails and nothing to recovery at all, the plaintiff has no responsibility and obligation to the lawsuit funding company beyond the plaintiff's own share of any recovery.
Generally, when a client owes a lawyer money, They can't lend any money to client. Lawyer will have an interest in recovering that money which may be inconsistent with the best interest of the client. Nevertheless, lawyer can refer their client to a lender who can offer a loan to their client, to help client paying expenses during pendency of lawsuit.
If plaintiff does not consider the lawsuit funding due to high cost, they may consider other alternative ways of financing such home loans, personal loans, borrow from friends or relatives, line of credit and etc.
Some time some plaintiffs are force to take the lawsuit financing even with high cost. For instance the plaintiff involved in an accident and injured, he will need to pay for the medical bills, obtain health care, to pay the rent or mortgage, or even to buy food.
However, it is better to involve the attorney in the process, so they can find the best lawsuit finance company who offer the best term.
For more information about other loans, please check out Various Loans Guide instead of Lawsuit Loan
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