If you have never applied for a legal cash advance you may have questions on how much money your can receive for your lawsuit. We will provide you with a brief overview of how much money you can receive through lawsuit funding. If you are interested in a cash advance against your lawsuit, contact LawLeaf today.
Borrowing money against a lawsuit
We will compare this asset class with a standard loan. When a person borrows money they will need to put up collateral. The collateral is used in the event the borrower defaults on the loan. If a person receives a personal loan and puts up their house as collateral, if the person defaults on the loan the lender may come in and take the home. While lawsuit funding doesn’t exactly work the same way, the borrower still puts up collateral. The collateral is the lawsuit or potential recovery from the suit.
When a person receives a loan from a bank or lender there is a good chance they won’t loan an amount greater than the collateral. When a litigation financing company spends money on a lawsuit, they too won’t provide more money than what a lawsuit is worth. This is how we can determine how much money you can borrow.
While the number may vary from company to company, most lenders will only loan a fraction of what the suit is worth. The percentage is typically between 10%-20% of the full value of the case. If the lender believes you will recover $100,000 from the case, they are likely to provide a non recourse loan for around $10k-$20k. The amount of money you borrow will be up to you.
If you are approved for a lawsuit loan you may also consider opening a line of credit. While not all companies offer lines of credit, it could certainly be an option if you believe you will need more money at a later date.
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