Here's something similar to what we've been advising our clients for years: Lawsuit Loans Add New Risk for the Injured. Basically, the loan is going to be a lot more expensive than what you expect it will be.
The article gives several examples:
- A Vioxx client faced eviction, so he took out a lawsuit loan to pay his rent. He borrowed $9,150. By the time his case settled (18 months later), the loan payout was up to $23,588.
- A car accident injury client borrowed $10,500. Two years later his payout to the loan company was $35,939.
The plaintiff lending companies are now lending more than $100 million a year in the unregulated industry. The companies manage to avoid loan regulations because they characterize the payments as investments, advances, financing and funding.
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