Paper: Lawsuit Loans Risky
We’d like to bring a January 17, 2011 article from the New York Times to your attention, as often our clients ask us about companies that loan money to accident victims.
The piece explores several plaintiffs who borrowed money from legal finance corporation, and ended up owing extremely large sums back to those companies after their lawsuits were resolved.
More than $100 million industry, these loans are unregulated in most states and borrowers are not protected by the same laws that oversee other lenders, according to the piece.
Often, interest rates can exceed 100%!! And, says the Center for Public Integrity, when companies give borrowers details they are often misleading.
A growing number of lawyers, judges and regulators say these lenders are taking too much money from the plaintiffs, says the Times.
In Colorado, the state’s Attorney General filed suit against two of the largest companies for loans they have made. In Michigan, courts have ruled that individual borrowers did not need to repay lawsuit loans, finding that the apparent risks did not justify outsize prices.
Nebraska legislators passed a bill sponsored by State Senator Steve Lathrop, a trial lawyer that prohibits lawsuit lending.
“My own personal view of these groups is that I discourage clients from using them,” Mr. Lathrop said during the final debate. “I tell them, go borrow from anybody you can before you have to use them.”
“But,” he concluded, “the reality is, sometimes there’s no other place to turn.”
I APPRECIATE WHAT YOU DID FOR ME IN SUCH A TIMELY MANNER AND THE SURPRISING AMOUNT. ALSO, THANK YOU FOR RETURNING MY PHONE CALLS. A LOT OF ATTORNEYS DON'T DO THAT. I WILL DEFINITELY RECOMMEND YOU.
Dear Mr. Mindell,
Your slogan states: “Experience Dedication Success”. I believe in my heart, strongly added to that should have been, “Honest Fair Integrity”. For those are the finest principles in you, and that was my experience of what you most importantly instilled and guide your practice on. Thank you so much. I do so respect you.
You folks are amazing! It’s a pleasure to work with people that under-promise and over-deliver—many thanks for all that you’ve done.
You went all out to help me when I needed it, and I want to say thank you from the bottom of my heart. You helped make my life so much better.
PROUDLY SERVING ALL OF MICHIGAN
FOR OVER 50 YEARS
800.963.5595 / 248.353.5595
32500 Telegraph Rd, Ste 104
Bingham Farms, MI 48025
934 Church St.
Flint, MI 48502-1010
1515 S. Wayne Rd.
Westland, MI 48186
748 West Grand River Ave
Brighton, MI 48116