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personal injury loan (1 viewing) (1) Guest
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TOPIC: personal injury loan
#2061
Henkel (User)
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personal injury loan 10 Years, 2 Months ago Karma: 0  
My client was approached by a company that loans money to support plaintiffs while in a law suit. These companies, then take a % of the settlement, if any.

It seems like a loan and thus usary laws would control. Anyone have any experience with such deals? It would require that the plaintiff disclose information to the lending company so they can make a decision as to whether they take the case. Also seems as if there are attorney ethics issues as to the release of information on a plaintiff where a lender is not bound by attorney rules of conduct.
 
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#2089
J. Law (User)
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Re:personal injury loan 10 Years, 2 Months ago Karma: 0  
I myself would exercise caution in entering into such transaction. You cannot just divulge to third persons the details of a case pending litigation, it might even turn out prejudicial to you in the end.

And you are right, this transaction goes into the core of attorney rules of conduct. it encourage speculation in our judicial system and must be curtailed. expect a legislation to be passed regarding this issue, soon!
 
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#2090
Sumo (User)
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Re:personal injury loan 10 Years, 2 Months ago Karma: 5  
This is a little derivation of the old selling your judgment business. For years companies have been buying potential judgments. These companies find plainitffs going through cases, evalute the case. If for example the company evaluates the case is worth $100,000.00, the company will offer the plaintiff 10-20K right now to assign his/her rights to a future judgment. Then for this fee, the company takes the risk of potentially getting ajudgment or not. If a judgment is obtained, they make money, if not they lose. These companies also offer to buy structured judgments. Plaintiff has a million dollar judgment paid over the course of ten years with interest, they offer the plaintiff a lump sum buy out of about 15-40% depending on the case flow, and the Plaintiff for a pay out today, assings his/her rights to this stream of payments. Has been happening for years. A lot of people have a lot of ethical questions about it, but its legal.
 
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