The financial consequences of divorce can be devastating, even if your marital estate is worth millions. If you and your spouse are in a bitter divorce battle and you do not have separate funds to support yourself and your legal bill, it can be difficult to pursue your half of the assets. Many individuals going through a divorce cannot qualify for a loan on their own, but fortunately that may soon change.
Novitas, a divorce funding company based out of Britain has recently started operating in the United States. Divorce funding companies seek to help the spouse without access to marital funds. The benefit for the divorcing individual is that the company does not collect its fee until after a settlement has been reached in the case. However, it is important to fully research each company before signing on with them to determine how high their interest rates are because they can differ dramatically.
For example, Novitas offers nonrecourse advances at rates of 1% to 1.5% a month. A nonrecourse advance is preferable to the divorcing individual because it means that the lender cannot recover if the divorce settlement fails to yield a payout. Other companies, such as BBL Churchill Divorce Finance, offers recourse loans, which means that if you do not recover money in your divorce settlement you still must pay their loan, fees and interest.
Although the loans from these companies have high interest rates, they also allow the “broke spouse” to pursue their ex for their share of what is typically a significant amount of money. By obtaining this type of financing, it helps level the playing field between the divorcing spouses. Of course, divorce funding will reduce the amount of your settlement, but without it, there might not have been a settlement at all.
If you are facing divorce or you have other family law needs, our legal team is here to help. Contact the Men’s Divorce Law Firm to schedule a consultation with a caring professional, and aggressive advocate for men’s rights in divorce, child timesharing (custody), and paternity matters.