Getting denied from any form of financial funding request can be very stressful, which includes getting denied for pre-settlement funding. For financial products such as car loans, things like your credit score and employment status can cause a denial; however, for pre-settlement funding those things are not a factor, yet there can be a number of different reasons for which you were denied funding. The following six factors are possible reasons your application may get denied.
- You Don’t Have an Attorney or There are Issues with Your Attorney
A prerequisite for lawsuit funding, or pre-settlement funding, is that you are represented by an attorney. No matter how great your claim, without an attorney representing you, the likelihood of being able to receive a positive award from the case is very low, and your application for funding will likely get denied..
Also, your attorney can guide you and give you advice throughout the process; however, you may get denied if he or she fails to provide all of the adequate, required documentation related to the case. Your attorney may also acknowledge the contract, with you, agreeing to comply with your repayment instructions. If your attorney chooses not to sign this contract, you will likely be denied.
- You May Have Reached a Limit of Available Funding
As you may expect, an application for funding will ask you if you have already sought funding based on your case. It is best to be honest, as funding companies will do their due diligence to ensure they have all details around your case.
Ultimately, if the funding company decides there is not room for more funding in light of your potential settlement or award, you may get denied because of that.
- Funding is Not Covered in Your State
State law vary all throughout the U.S., and states differ on regulations that may or may not apply pre-settlement litigation funders. If you are trying to get funding in certain states, you may be out of luck because various funding companies opt to not operate in those locations. Pre-settlement funding companies will always make sure you are a resident of the state you apply for funding in, and if you reside in states they don’t operate in, your application will be denied.
- You Have Financial Liabilities that Don’t Meet Guidelines
Credit score is never a factor in determining eligibility for pre-settlement funding. However, a funding company does need to review some of your financial liabilities when considering your application. Things like child support liens and bankruptcies will often be grounds for denial. However, once any of these are cleared up and satisfied, you are often able to reapply.
- Your Case is Too New
As mentioned above, documentation is critical to any lawsuit. If there isn’t enough documentation (e.g. police report or medical documents) to base a funding decision on or the accident is too recent, a pre-settlement funding company may decide it is too early in your case and therefore won’t be comfortable providing you with funding. Since funding companies are taking risks on the funding requests they accept, they understandably will require documentation and need enough information about the legal claim to render a decision on an application. By submitting an application for funding too soon after the incident, that documentation will likely not be available yet, and your application, in turn, may be declined.
- Liability Issues
Even if you think you have a great case, funding companies will need to be sure that you were not at fault for whatever happened. If liability is unclear, funding companies will likely not approve your application. Often, the circumstances of a case differ from what plaintiffs think or say happened, so funding companies will need to see all of the facts of a case before approving an application.
Oasis provides pre-settlement funding, also known as consumer litigation funding, to its customers through different products depending on their state of residence or cause of action. Many consumers will be provided pre-settlement funding in the form of a purchase agreement, which assigns a portion of the pending proceeds from their legal claim. Other consumers, such as those in CO, IL, MN, MO, SC, WI and some OK residents, will be offered a funding in the form of a pre-settlement loan, sometimes referred to as a lawsuit loan. These transactions have important differences, therefore, consumers should carefully review and be aware of the type of transaction that is offered to them by any funding company.