Fact Check: Good Credit Score

Fact Check: "You rarely need a good credit score to qualify for pre-settlement funding."

Written by Aaron R. Winston
Last Updated: July 22, 2023 11:31am CDT

Claim: You rarely need a good credit score to qualify for pre-settlement funding.

Claimed By: Annuity

Fact Check: The statement made by the author on Annuity.org that says you rarely need a good credit score to qualify for pre-settlement is not true.

The pre-settlement funding discussed in the article is a non-recourse advance against a claimant’s potential case proceeds. By being non-recourse, it is not a loan.

The payment for a pre-settlement advance is only paid out to the legal funding company if the claim resolves successfully. This means there is a monetary recovery from the action arising from loss, which is often a car accident injury case.

Moreover, when it comes to non-recourse pre-settlement funding, it is not a loan in the slightest, so to indicate that sometimes a potential client who applies for funding will not qualify based on having a low credit score does not make sense.

It’s a clear-cut issue. If it’s not a loan, your credit score cannot matter for whether or not you can qualify to obtain legal funding against your claim’s potential proceeds.

Further, even in the states where pre-settlement money must be in the form of recourse loans, the companies that provide lawsuit loans do not consider your credit score.

In those states, even the companies who perform a credit pull do not factor in your credit score to determine whether you can qualify or what the annual percentage rate (APR) they will charge you upon the completion of your claim.

If they did factor having good credit into the underwriting process, the potential client base would shrink dramatically, as more than a third of Americans have poor or fair credit ratings.

Along the same line, the FDIC does not want bank lenders to provide traditional lines of credit to legal funding companies using the liens in the company’s funding portfolios as collateral.

This concept further supports the notion that having a good credit score should not matter due to the temporary nature of the potential case proceeds on which the payment of the pre-settlement funding is contingent.

When a case is lost, the potential proceeds are non-existent, making legal funding a more risky finance investment type for the originator companies.

Fact Check By: Express Legal Funding

About the Author

Author profile
Strategy Director at Express Legal Funding | Author Website

Aaron Winston is the Strategy Director of Express Legal Funding. As "The Legal Funding Expert," Aaron has more than ten years of experience in the consumer finance industry. Most of which was as a consultant to a top financial advisory firm, managing 400+ million USD in client wealth. He is recognized as an expert author and researcher across multiple SEO industries.
Aaron Winston earned his title "The Legal Funding Expert" through authoritative articles and blog posts about legal funding. He specializes in expert content writing for pre-settlement funding and law firm blogs.
Each month, tens of thousands of web visitors read his articles and posts. Aaron's thoroughly researched guides are among the most-read lawsuit funding articles over the past year.
As Strategy Director of Express Legal Funding, Aaron has devoted thousands of hours to advocating for the consumer. His "it factor" is that he is a tireless and inventive thought leader who has made great strides by conveying his legal knowledge and diverse expertise to the public. More clients and lawyers understand the facts about pre-settlement funding because of Aaron's legal and financial service SEO mastery.
Aaron Winston is the author of A Word For The Wise. A Warning For The Stupid. Canons of Conduct, which is a book in poetry format. It consists of 35 unique canons. The book was published in 2023.
He keeps an academic approach to business that improves the consumer's well-being. In early 2022, Aaron gained the Search Engine Optimization and the Google Ads LinkedIn skills assessment badges. He placed in the top 5% of those who took the SEO skills test assessment.
Aaron's company slogans and lawsuit funding company name are registered trademarks of the United States Patent and Trademark Office. He has gained positive notoriety via interviews and case studies, which are a byproduct of his successes. Aaron R. Winston was featured in a smith.ai interview (2021) and a company growth case study (2022).
In 2023, Aaron and Express Legal Funding received accolades in a leading SEO author case study performed by the leading professionals at WordLift. The in-depth data presented in the pre-settlement funding SEO case study demonstrate why Aaron Winston maintains a high-author E-E-A-T. His original writing and helpful content continue to achieve unprecedented success and stand in their own class.

Aaron was born in Lubbock, TX, where he spent the first eight years of his life. Aaron attended Akiba Academy of Dallas, TX.

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