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"Get Cash in 24 hours!" "Need cash now? Get a cash advance for your pending lawsuit." "Lawsuit Loans for Lawsuit Cases."

Your credit card bill already comes attached to alluringly blank "convenience checks." Your tax preparer tempts you to apply for tax refund loans. You're bombarded with television commercials for payday loans.

Now, a relative newcomer to this list of "fast cash" borrowing enticements is beginning to hit critical mass and it suddenly is attracting a high degree of attention from state legislatures.

It is called a "lawsuit loan" or, if you are in that business, "lawsuit funding." Regardless of the label, it is cash loaned to plaintiffs awaiting judgments or settlements in civil lawsuits, most often personal injury cases such as auto accidents, product liability issues, slips and falls, and so on.

It is a rapidly growing - if still little known - financial phenomenon, one that currently accounts for an estimated $100 million in business every year. Plaintiff lawsuit funding began around 1997, according to an industry group.

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Lawsuit loans can prove helpful to some people, particularly those who are in dire financial straits, but they are controversial and politically charged. Since January 2013, at least 20 bills have been filed in state legislatures to regulate the burgeoning industry. Lobbyists pro and con are waging pitched battles this year in the legislatures of Illinois, Indiana, Missouri, Texas and at least seven other states.

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If you're a borrower, they can be astonishingly expensive. Some lawsuit loan borrowers find themselves paying annual interest rates in excess of 100%.

"The lawsuit lenders charge sky-high interest rates on these loans, often more than 100% annually, " said Justin Hakes, a spokesman for the U.S. Chamber Institute for Legal Reform, which represents business interests and serves as a counterweight to groups representing plaintiff trial lawyers.

"Even when the consumer 'wins' or settles the case, he or she often recovers no money, because the entire amount of the award or settlement goes to pay the plaintiff's attorneys or to repay the lawsuit lender, " Hakes said.

Representatives of the lawsuit funding industry acknowledge that interest rates, which they prefer to call "funding fees, " are high. They say this is necessary because they are taking most of the risk. The borrowers tend to have poor credit ratings, few other resources and one great advantage when it comes to lawsuit loans: If the borrower loses the underlying court case, he or she never has to repay the loan.

"In our case, we are only paid back when and if there are sufficient funds to repay us from the settlement, " said Eric Schuller, director of government affairs for Oasis Legal Finance, based in the Chicago area and one of the nation's most active legal financing firms.

"In most cases, the attorney gets paid first, then any other liens on the claim, such as medical and mechanical liens, " Schuller said. "Also, there may be statutory liens on the claim, such as child support. Then and only then, if there is enough to pay us, we get our money. We never go after a consumer after the fact if there are not sufficient funds to repay us."

Interesting facts

  • Don't Tell the Bride is back this time with its first civil partnership, as daring Dan tries to plan the perfect day for his partner Mark.
    London couple, Dan (28) and Mark (29) have been together for six years after meeting in a bar in Sydney. Despite asking Dan to marry Mark, their plans have been on ice due to lack of cash - Mark is still...
  • David Hencke is a British investigative journalist and writer.
    Hencke joined The Guardian in 1976, becoming the newspaper's Westminster Correspondent in 1986. He has won numerous awards for his political coverage.
    In 1994 he was named What the Papers Say Journalist of the Year for his investigation which uncovered the “Cash-for-questions...

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Where can one obtain cash loans now.

One can obtain a cash loan immediately by applying for a cash advance through a credit card or rapid loan company such as Money Now, CashNetUSA or Cash Now. One can also request a cash loan through a friend or employer.