Workers compensation or workman’s compensation is an insurance program mandated by the state for compensating federal as well as some other types of employees suffering work related illness or injuries. Workers compensation Lawsuit Funding on the other hand is an innovative product offering by the financial industry to mitigate the financial sufferings of employees who have a pending lawsuit or a compensation case.
Advantages of workers compensation Lawsuit Funding
Before discussing the advantages of workers compensation lawsuit cash advance, it must be understood that most states across the United States of America have independent enactments concerning the subject. In many states the settlement amount when arrived at is mandated to be paid direct to the claimant and not to the trust administered by the attorney. Therefore, when a lawsuit in this regard is admitted in a state where this mandate is in force, legal funding companies cannot entertain an application for workers compensation Lawsuit Funding.
However, in states where the aforesaid mandate does not apply, individuals who have filed a lawsuit for workmens compensation can apply for the pre settlement cash advance. The major advantage with this type of legal funding is that they are offered as ‘no recourse loans’ which effectively means that the borrower is not obliged to repay the loan in the event of his/her losing the lawsuit. Apart from this, the best legal funding companies do not run a credit check or income verification. However, it is imperative that you produce an assessment of your suit from your attorney which will also carry the projected settlement value.
*How much should you expect? *
Often times, workers compensation Lawsuit Funding will be limited to about 20% of your projected settlement. Most attorneys handling this type of lawsuits do not insist on upfront payments and even foot the expenses incurred in prosecuting the case. However, upon settlement they will claim one third of settlement towards their fee. In instances where the claimant has suffered medical expenses, another one third of the claim is set aside to meet those expenses. The legal funding company factors in their costs and interest charges before arriving at the amount of loan that you are eligible to apply for
Being an informed borrower
A convenient loan like the workmens compensation Lawsuit Funding comes at a price and this is often higher than other forms of credit. The reasons are not far to seek since the character of the loan has its own inherent risk to the legal funding company. One way you can aid your decision is by positioning yourself as an informed borrower. The internet is a great place to gather all the information you need. Focused research and quality time are the essential ingredients to find what you need. Do remember that you are not obliged to accept the first offer of workmens compensation Lawsuit Funding and you are free to explore other lenders who may offer affordable terms. Another factor that should aid your decision is the extent of time that you can buy with the help of workmens compensation Lawsuit Funding to avoid exploitation by the insurance carriers/assessors.
About the author
James Sheridan is the Contracts Manager at Pegasus Legal Funding LLC and is responsible for the final stage of the funding approval process. James focus and priority is delivering to PLF’s clients the funds they need as quickly as possible