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Accidents never happen at good times. I am saddened by the many people who come into the office and are fearful of losing everything they have after their own injury or the loss of a loved one. In these tough economic times, to suddenly be unable to physically do your job is frightening. These aren’t the times to be taking extended time off or to have to look for something else to do.

In representing these people, we do our very best to maximize the recovery. But , having to wait for doctor reports, healing times and to get a full understanding of the loss can take time. Occasionally, we will hear that our client is talking to a presettlment group that offers early money on cases. Daytime TV has a regular ad that runs.

The problem is that these loans come with large paybacks. They get around the interest laws by agreeing that if you lose your case, they don’t get the money back. But, they aren’t loaning large amounts of money to cases that they don’t expect a big return on. Recently the Pennsylvania Supreme Court looked at a case where $334,000 was owed after a $32,000 early loan.

While these loans are looked at as ways to save a house, pay for food and basically get a person beyond a very tough time, it’s imperative that all of the terms be reviewed. The interest rates are astronomical and they can take over your whole case. As the person’s lawyer I always advise against making these deals. Hopefully, most people don’t do them. Hopefully, Minnesota will look at laws , as 45 other states have, to limit the breadth of these contracts.

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