A serious car accident can completely change your life. While you may have been in a good financial position before the accident, you are now facing ongoing medical bills and the inability to work for the foreseeable future. These costs can be especially frustrating when you were simply a passenger in the vehicle.
Pursuing legal action is often an important step in moving forward after a serious accident. But while you wait for a potential settlement, your expenses continue to accumulate. Car accident lawsuit funding in New York could help you bridge the gap until your potential lawsuit payout, but you may wonder about eligibility.
Explore who qualifies for lawsuit funding, how this option works, and when it might be helpful.
Exploring the Cost of Serious Car Accidents
The National Safety Council reported on the economic impacts of different types of car accidents in 2024. The average cost for accidents causing fatalities was $2,050,000. Accidents causing disabling injuries cost an average of $174,000; in contrast, accidents causing property damage only cost an average of just $6,600.
If you were a passenger in a serious car accident, you may have had no control over the outcome of the crash. Now, you are facing significant expenses, including any of the following:
- Medical bills
- Medical equipment costs
- Time off work
- Loss of future earning capacity
If you are pursuing a lawsuit against the at-fault party, you may have funds coming your way eventually. But lawsuits can take over a year to settle in some cases, and in the meantime, your bills and debt continue to pile up. Exploring funding options for passengers injured in car accidents can help you avoid going into more debt while you wait for your settlement.
Car Accident Lawsuit Funding Options for Accident Victims
Pre-settlement funding for car accident passengers can include a range of loans and other funding options. Generally, this type of funding provides you with a cash advance on your eventual settlement, which may be helpful if you are facing immediate financial hardships as a result of your accident.
It often works like this:
- The funding company evaluates your case to determine your potential settlement and the likelihood that you will walk away with compensation.
- The company offers you a percentage of your estimated settlement as an advance, typically in a lump sum.
- At the end of your lawsuit, you repay the borrowed amount, plus a fee, out of your settlement.
- If your case ends without a settlement or payout, you would not owe the funding company anything.
The process of seeking car accident pre-settlement lawsuit funding is often fairly quick, with many companies advertising that you can secure an advance within 24 to 48 hours.
Who Qualifies for Lawsuit Funding in New York?
Car accident lawsuit funding works differently from traditional loans. Your eligibility is generally not based on your financial situation, credit score, income, or any other personal economic factors. Instead, lawsuit funding companies in New York examine the strength of your case as a primary factor in determining eligibility.
While every funding company has different eligibility criteria, many review the following factors as part of your application:
- Eligible legal case: You typically need to have a qualifying personal injury claim, such as an auto accident claim, to be considered for pre-settlement funding.
- Strength of case: The funding company will want to see that you have a strong case likely to settle or result in a payout. It may request documentation and evidence to better understand the strength of your case.
- Damages sustained: Understanding your damages can help the funding company estimate the value of your case and determine how much it may be willing to offer in the form of an advance.
- Length of case: The company will also want to know the expected length of your case to understand when it might receive the repayment and fees on your advance.
- Insurance coverage or assets: If you are pursuing action against an insurance company, your potential payout may only be as high as the policyholder’s coverage limits. If you are suing an individual, they will only be able to pay you with assets they currently have. The funding company will evaluate both variables to determine the maximum potential payout you could receive.
- Attorney representation: Many pre-settlement funding companies require you to be represented by an attorney to be considered for funding. This is because companies rely on your lawyer to disburse funds from your final settlement.
When you apply for funding, you will fill out an application with these details and attach documentation to support the strength of your claim and your need for funding.
Who Might Be Ineligible for Pre-Settlement Funding?
Passenger injury settlement funding is not available to everyone. These are a few reasons a funding company might deny an application:
- You do not have an attorney representing you on a contingency basis.
- Your attorney refuses to participate in the application and verify your case details.
- Your claim is not strong enough for the company to feel confident lending you an advance.
- You have liens on your future settlement.
- You have already accepted other advances on your case.
- Liability in your case is disputed or unclear.
- Your expected settlement is low.
- You have incomplete documentation or missing details in your application.
What Can You Use Pre-Settlement Funding for After an Accident?
If you qualify for car accident lawsuit funding, you can often use this advance however you see fit. Many plaintiffs in car accident cases use their funding for:
- Paying down medical bills and avoiding interest
- Affording normal life expenses, like mortgages and utility bills, while out of work
- Purchasing necessary medical equipment
- Paying down debt accumulated during your recovery period
- Affording the initial legal fees associated with your case
Many plaintiffs find that pre-settlement funding offers the breathing room they need to avoid settling too quickly.
Explore Pre-Settlement Funding Options Today
If you are wondering about qualifying for car accident lawsuit funding, filling out an application is a straightforward way of determining whether you qualify. At Apex Legal Funding, we offer financial solutions to plaintiffs in car accident cases and other personal injury lawsuits. Apply now to learn whether you may be eligible for funding.
Frequently Asked Questions
When do you need to repay car accident lawsuit funding?
You generally would need to repay car accident lawsuit funding upon receipt of a settlement. Your attorney would take the borrowed amount, plus fees, out of your settlement award to reimburse the funding company.
What if you lose your case after accepting pre-settlement funding?
If you lose your case after accepting pre-settlement funding, you typically would not owe the funding company anything. This is a type of non-recourse funding, which means the company assumes the risk of lending to you and your case falling through. As a result, pre-settlement funding is often only available to plaintiffs with strong cases.
Do passengers in car accidents qualify for pre-settlement funding?
Yes, passengers in car accidents may qualify for car accident funding if they are actively pursuing legal action against the at-fault party and meet other eligibility criteria. You can fill out an application to understand whether you may be eligible.