If you’ve taken out multiple lawsuit loans to cover your expenses while awaiting a settlement, you may be overwhelmed with the various terms, interest rates, and payment schedules. Some borrowers combat this by consolidating lawsuit loans and combining them into one payment. While consolidation can be beneficial, there are risks to watch out for. Keep reading to learn more about lawsuit loan consolidation and the alternatives available in Los Angeles.

How Lawsuit Loan Consolidation Works

Loan consolidation, or lawsuit funding buyouts, involves borrowing a sum to cover each lawsuit loan you’re trying to pay off. Lenders may pay these creditors directly or deposit the money in your account so that you can make the payments yourself. With all your other loans paid off, you only have to worry about one monthly payment with one interest rate. 

Consolidating loans is often done to reduce interest payments and pay less monthly. The benefits of pre-settlement loan consolidation will depend on the interest rate applied, the length of the loan repayment, and the fees incurred, such as application or origination fees.

You can option a secured or unsecured debt consolidation loan, depending on the lender. A secured consolidation loan will use your assets as collateral, including your house, car, or retirement account. An unsecured consolidation loan does not require anything for collateral. However, you often borrow more money with a secured loan than an unsecured loan.

Potential Risks of Consolidating Lawsuit Loans

While consolidating your lawsuit advances can feel like an obvious choice, there are potential risks to be aware of. Firstly, there is no guarantee of a lower interest rate. The interest rate you receive is often dependent on your credit score. If you have a low credit score or too many inquiries on your credit report, you may receive the same interest rate as before, or worse, a higher interest rate, which can result in you paying more than your final settlement amount.

Late or missed payments can also hurt your credit and result in higher fees. If you miss a payment on your consolidation loan, your credit score can drop, and the lender will likely charge you additional late fees. Taking out a consolidation loan already affects your credit score due to the hard inquiry required when applying, so you’ll want to make sure you don’t miss any payments, as you could see your score decrease further.

Questions to Ask Before Consolidating

Before taking out a consolidation loan, ask the following questions:

Ask yourself these questions to help you determine if consolidating loans for your California lawsuit is the best choice. The interest rate and loan term are key factors in deciding if consolidating will actually save you money. Interest will add up the longer you take to pay off the loan. If making the consolidation payments is going to negatively affect your financial goals or impact your case, you should consider looking at other options.

Alternatives to Consolidation

There are other options to consider before taking out a consolidation loan, such as loan refinancing which will rewrite the terms of your initial lawsuit loans to benefit your payment amount and future settlement. If you currently have a high-interest lawsuit loan, refinancing can reduce your interest payments, resulting in lower long-term debt. You can also negotiate your repayment period, depending on your situation, to shorten the period to pay off the loan quicker or extend it to lower your monthly payments.

Contact Fund Capital America for Cash Advance Refinancing

To learn more about cash advance refinancing and if it’s right for you, contact Fund Capital America. We offer plaintiffs and attorneys in Los Angeles flexible financing options to reduce lawsuit loan payments. We’ll discuss your options and find a personalized solution for your situation.

Refinancing with Fund Capital America offers various benefits, including quick turnaround times, competitive interest rates, flexible terms, and no upfront fees. We’re committed to customer service and will be transparent and honest about your options. You won’t feel the need to settle a case early due to debt and can trust in our ‘no win, no repayment’ promise. Call us or apply for a lawsuit cash advance online today!

Frequently Asked Questions

How does consolidation affect the timeline of my case?

Consolidation won’t affect your case’s timeline but can affect your debt repayment schedule. If your loan consolidation terms involve an extended repayment schedule, you will repay the loan for a more extended period. If consolidating results in a higher interest rate, you may also see your payments extend beyond the time you get your settlement, as you may owe more than you receive due to increased interest rates and fees.

What are the top factors to consider when it comes to loan consolidation?

When considering loan consolidation options, the top factors to consider are the interest rate, repayment terms, maximum loan amount, and additional fees. These factors will determine whether lawsuit loan consolidation will save you money or end up costing you more. Ask your lender if you can check your rates without making a hard inquiry, which will impact your credit score.

Will a cash advance on a lawsuit settlement lower my credit score?

Applying for a cash advance on a lawsuit settlement through Fund Capital America does not affect your credit. We will not consider your credit score when you apply, as approval depends on the merit of your legal claim. Lawsuit funding from our company will not appear on your credit report and has no chance of negatively affecting your score.