If you have been slapped with a lawsuit and need to go to court, you are no doubt feeling overwhelmed. You are hoping that you will win your case and for this, you need the best legal services possible.
Unfortunately, great legal services cost an arm-and-a-leg. Legal funding is an issue many Americans face when dealing with lawsuits.
If you find yourself in this situation, you can always go to a funding company. These are companies that let you borrow money for a legal case.
But, before you request legal funding make sure you ask these questions to a funding company.
What Type of Loans Do You Have?
Make sure you inquire about the type of loans offered. For example, you must know these differences between a Structured Settlement Loan and a Pre-Settlement Loan.
You want to learn about the rules that come with the loan you choose. How much interest is charged on the loan? How long do you have to pay the loan back?
You want to know as many details as possible before choosing your loan. Make sure you inquire about the most popular loans. Also, ask about the loans best suited for your specific legal case.
What’s the Compounding Frequency?
To determine how much interest you might end up paying, you want to check the compounding frequency.
You want to know if the interest gets charged on a daily, monthly, or yearly basis. For example, if there’s a 10% interest fee, is this added at the end of the year or the end of each day or month.
The less frequent the compounding frequency is, the lower your interest fee is.
What Are the Front-End Fees?
In addition to receiving your legal funding, you want to know if there are any additional fees you have to pay upfront. If you request $1,000 at a 5% interest rate your interest rate might not be the only fee you have to pay.
You might have to pay a transfer fee. If you request $1,000 the funding company might charge a $50 transfer fee. So you will only receive $950. As a result, if you need the full $1,000 you have to request $1,050.
You want to avoid or minimize front-end fees when possible. Ask the funding company what methods there are to do so. However, if you are given an option to forgo a front-end fee for a higher interest rate, it’s generally best to avoid this option.
What Are the Back-End Fees?
These are back-end fees that might arise from your lawsuit. Your lawyer might need to do additional research to win your case. They might need to archive or digitize documents. They might have to pay to notarize a form.
All of these expenses get added on top of your legal fees. You want to ask the funding company what their back-end fees are. If you receive compensation for a lawsuit, the funding company usually requests a portion of your compensation to get paid as back-end fees.
Find Your Funding Company
You are now ready to find your funding company. Make sure to ask these vital questions so you can find the best funding company for your needs.
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