What Is The Interest Rate On The Lawsuit Loan And Why Is A Lawsuit Loan Considered A Non-Recourse Loan?

We are frequently asked what the interest rates are on a lawsuit loan. Unfortunately, this question arises because the applicant’s are actually unfamiliar with the overall process.

In reality, there are no interest rates involved with a lawsuit loan. The fees that are charged for providing the lawsuit loan are in fact “risk-fees.” The fees charged in funding your lawsuit loan are contingent on the risk inherent in your particular case. If the risks are low, the fees are low.

It is unfortunate that many plaintiffs allow these perceived interest rates to keep them from pursuing a lawsuit loan. In many instances, such funding would allow these plaintiffs to continue in the fight to obtain a fair and equitable settlement. In the absence of such funds, many plaintiffs are simply unable to continue in the litigation-process, and are forced to settle their claims at amounts that are significantly lower than their claims would merit.

Obviously, since a lawsuit loan is not, in reality, a loan, we are not dealing with non-recourse loans. Contrariwise, we’re looking at a non-recourse transaction. The reference to “non-recourse” loans is simply for ease of reference. It is in fact this aspect of obtaining a lawsuit loan that makes this funding extremely appealing!

The term “non-recourse” simply refers to the fact that the entity that provides the resource requested (e.g., funding, supplies, etc.) has no recourse against the party to whom/which the resource is provided when certain conditions of the negotiation are met. In the case of a lawsuit loan, the non-recourse aspect refers to the fact that the funding-entity is unable to demand a return of the funds provided if the requestor does not prevail in the underlying suit. In other words, if you lose your case and you have obtained funding, you don’t have anything to repay.

Are you confused about obtaining a lawsuit loan? Please stop by our site to find out all about the benefits of obtaining lawsuit loans and what they can do for you.