I Need Money NOW!!!
Attorney
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I don't know about other attorneys, but there is a certain element preying upon those who have been injured and who feel like they need money NOW, and frankly, it's a little sickening. Who are these people? Oasis Legal Finance. J. G. Wentworth. And, the one that just came in our our fax machine: AnyLawsuits. These companies offer money to people with lawsuits, and they are very enticing to our vulnerable clients.
What's wrong with these companies offering such nonrecourse loans? The usurious interest rate that they charge. For example, one of our clients was recently considering getting a loan from one of these companies for $7,500.00. As soon as the loan would be made, the client would owe $9,500.00. If the loan remained outstanding for 1 1/2 years, they would owe $19,000.00 - more than twice the funds received. That should be illegal.
Why? Most of these companies will not loan money to these clients without discussing the case with the attorney and having their own attorney underwriters look at the case. They know when they loan the money that there is a high percentage change that they will get their money back. So, in reality, they are not taking a huge risk in making the loan even though it is nonrecourse financing (nonrecourse means that the person borrowing the money doesn't have to pay it back if they lose their case).
These companies use emotion to entice clients to call them. Many times clients have hit on hard times because of their injuries. It gets harder to pay bills, and these companies realize this and use this to their advantage. They even buy out an individual's structured settlement in order to give them money NOW. These structured settlements are entered into to protect the individual's money. Significant thought goes into such a settlement, and sometimes, when there is a minor involved, a judge has approved the structured settlement at a pro ami hearing (a hearing to approve a settlement on a minor's case).
Until the courts allow lawsuits to proceed against these companies for deceptive trade practices, violations of finance laws, or other wrongful conduct, these companies will continue to "steal" money from these unfortunate individuals. Another solution? Legislators could enact laws to prevent these companies from either loaning money on cases, buying structured settlements, or charging such outrageous interest. Encourage your legislator to do so.