Give Me Credit: Do You Need Good Credit for a Settlement Loan?
The answer is: absolutely not. Among those new to these loans, this is a common misconception.
With many loans these days, you do need excellent credit to be able to get your foot in the door. It’s surprising how poor credit is rampant these days, yet many creditors are not very understanding about low credit scores.
With settlement loans, the loan is against an upcoming verdict and monetary award in a lawsuit, so your credit isn’t taken into consideration; most never even look at your credit in the decision process. It’s based purely on your award after the case is settled.
As with anything like this, make sure and investigate all of the ups and down of a case before looking into a settlement loan.
Make it clear: Is a settlement loan an actual loan?
We’ll make the differences clear now: is a settlement loan anything like a regular loan? Not at all.
A settlement loan is much different than a traditional loan; in fact you can’t even consider a settlement loan an actual loan at all. It’s more like a lending provider buying interest into your lawsuit. They are providing you an advance on your possible winnings in a lawsuit in return for that amount back with interest. A settlement loan is based solely on your current lawsuit case; your credit history and current income play no role what so ever in the decision process.
What stands out the most in the differences between a settlement loan and a traditional loan is a settlement loan does not have to be repaid if the case is lost. Yes, that means if you lose your pending lawsuit you do not have to pay back one dollar to the settlement loan provider. You’ll also not receive any marks on your credit history (many don’t know this fact), nor will it affect any future chances of receiving a settlement loans in future cases.
It’s (almost) free money, an advance towards your possible case winnings.