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How to Save on Lawsuit Loan Rates

Simple v Compound Rates
When choosing a lawsuit funding company it is important to ask whether they charge simple or compounding rates on their advances.  Paying a simple rate versus a compounding rate could save you hundreds if not thousands of dollars.
 
The rate for lawsuit funding varies widely, but many companies charge in the neighborhood of 36% a year.  That sounds expensive so companies will advertise 3% a month to appear less expensive.  However, if the rate is compounded monthly, then you end up paying a lot more than 36% a year. 
 
A compound rate means that interest is charge on the principal you borrow and the interest as it accrues.  A simple rate means that interest is charged on only the principal you borrow.  The higher the rate and more often it is compounded, the more expensive it will be. 
 
Let’s take a look at an example to see how compound rates differ from simple rates on a $10,000 advance.  
 

Will Driverless Cars Hurt Personal Injury Litigation?

Benefits of Driverless Cars
Companies are in an “arms race” to develop self-driving cars for the masses.  The benefits are endless for consumers.  Imagine driving to work without having to pay attention to the road.  You could drink your coffee, check emails on your phone, read a book or even take a nap while your car drives itself to your office.  The handicapped and elderly would be much more mobile.  Driving while intoxicated would no longer be a threat to society. 
 
Over 5 million car accidents occur every year resulting in over 2 million injuries.  Driverless cars would dramatically reduce these statistics by eliminating human error.  More than 90% of accidents are caused by human error, while less than 10% of accidents are caused by vehicle malfunction.  More than 80% of drivers think they are above average drivers, which can’t be true. 
 

Why Attorneys & Law Firms Choose Bridgeway for Their Clients

Why Bridgeway?
We get it.  We do our best to provide clients the money they need as fast as possible, at the lowest possible cost and with the least amount of work for your firm.
 
In an ideal world a client would never need a pre-settlement advance.  Unfortunately; that is not the case and in many situations a client needs a pre-settlement advance to enable their law firm the time to fight for the full value of their case instead of accepting a sub-par offer out of necessity.  
 
Bridgeway’s goal is to make legal funding a viable resource for when a client really needs it.  The funding Bridgeway provides is typically used to replace income lost while a client is out of work, to make a mortgage or rent payment, or pay for a medical procedure that a client needs.  Other uses include repairing a car, childcare and other essential life needs for the client to maintain their standard of living during a difficult time.
 

Simple v Compounding Rates in Lawsuit Funding

Simple v Compounding Rates in Lawsuit Funding
 
The rate lawsuit funding companies charge varies widely, but many charge roughly 36% a year.  These rates apply to pre-settlement funding. 
 
Some companies charge compounding rates while others charge simple rates.  The difference between these two types of rates is important to understand when choosing which lawsuit funding company to use. 
 
A compounding rate means you are charged on the borrowed principal and the accumulating interest.  A simple rate is charged only the borrowed principal.  A company may advertise a lower, teaser rate up front, but you end up paying more because the rate compounds.  The effect of compounding is greater when the amount of the loan is greater and the duration is longer.  Typically lawsuits take longer than expected to settle and having to pay a compounding rate could reduce your settlement dramatically.       
The following chart gives an idea of what interest rates are typically paid in lawsuit funding. 
 

If I'm a Passenger in a Car Accident can I sue?

If I’m a Passenger in a Car Accident can I sue?
If you’re a passenger in a car accident you usually have a great case.  Whether your driver or the driver of another car was at fault, as a passenger you do not have to prove who is at fault.  As a passenger liability is typically not contested. 

Why Pre-Settlement Advances (AKA Lawsuit Loans) can be Expensive

Why Pre-settlement Advances (AKA Lawsuit Loans) can be Expensive
 
Non-recourse Advance
A pre-settlement advance is a non-recourse type of advance, which means that if you don’t win your case, you don’t owe back the funding company.  When a funding company looks at your case they cannot determine with certainty that your case will be successful.
 
A certain percentage of cases in which they think will win, actually lose.  In addition to an outright loss other circumstances can cause the advance to go awry.  An attorney may fire their client or the client may fire the attorney.  Other unforeseen events could affect the success of the case.  The client may have a prior medical condition, liability may be in question or there may not be adequate insurance available. 
 
Because of the risk and uncertainty of the outcome of every case, investors require a higher rate of return on a lawsuit advance than other types of investments. 

Minimum Car Insurance Limits by State

Minimum Car Insurance Limits by State

Each state requires a minimum amount of coverage for auto insurance policies.  The type of coverage includes bodily injury (BI), physical damage liability (PD), no-fault personal injury protection (PIP), property protection (PPI), uninsured motorist (UM), and underinsured motorist (UIM). 

If you have been involved in a car accident, knowing the insurance limits of the vehicles involved in the accident is important in determining the value of your personal injury case.  If the insurance limits are unknown, then you must assume that your case is worth only up to the state minimums.

What is my MVA Personal Injury Lawsuit worth?

What is my MVA Personal Injury Lawsuit worth?
There are multiple factors that determine the worth of a personal injury case.  In the case of a motor vehicle accident the value is affected by the damages (injuries, medical expenses, property), liability (who is at fault?), and the insurance (maximum recovery).  All of these play into what the victim of the accident can receive in a settlement. 
 
Damages
Some damages caused by a car accident are easily measured in dollars.  Common bodily injuries from an auto accident affect the head, neck, back, shoulders, chest, legs, and abdomen.  Common injuries include concussions, herniated disks, whiplash, broken bones, fractures and torn ligaments.  These injuries require treatment ranging from surgery to physical therapy that is quantified in the form of medical bills.  However, you won’t know the exact value of your injuries until you’ve stopped treating and reach maximum medical improvement (MMI).

How Long Will my Personal Injury Lawsuit Take?

How long will my Personal Injury Lawsuit take?
Our clients often ask how long their lawsuit will take to settle.  The answer is we don’t know for certain because each case is different.  However, in our experience the average personal injury lawsuit takes 20 months to be resolved from the time the accident occurred. 
 
Timeline of a Lawsuit
 
Accident
The day of the accident is important because this is when your case begins. 
 
Your injury may have been due to a motor vehicle accident, a slip and fall, a worker’s comp accident or other accidents.  Whatever the cause, you may be entitled to compensation for your injuries. 

What to Look for when Taking a Lawsuit Loan

What to Look for when Taking a Lawsuit Loan
 
Non-recourse
Before you take pre-settlement funding make sure the advance is non-recourse.  A non-recourse advance is not backed by your personal assets.  You shouldn’t owe anything if your case is unsuccessful.  Make sure this is clear before signing a contract. 
 
It’s all about the payback
What is most important to consider when taking a pre-settlement advance is how much you have to pay back when your case settles.  You want to pay back as little as possible to the funding company so that you end up with the majority of your settlement. 
 
Make sure to find a company that clearly states what you will owe back and when.  If the funding company is not willing to give you this in writing go to another company.   If they are willing to provide this information you can make an apples to apples comparison as to where to find the least expensive funding. 
 
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