Legal fee loans exist to help you level the legal playing field.
A relationship breakdown can be a challenging and confusing time to begin with – and worrying about how to pay for legal advice can make it even harder. With a legal fee loan, you can focus on finding the right advice, without worrying about how to pay for it upfront.
A legal fee loan is a special type of personal loan designed to help you pay for family law matters. It can give you the funds you need to get the right advice from your lawyer and is repaid once a resolution is reached. Unlike a standard personal loan or a credit card, legal fee loans are specially designed to support you through this difficult stage.
Financing for your unique situation
When it comes to most other personal loans, you have to make choices about your loan type. Will it be secured or unsecured? Do you want a fixed or variable interest rate?
Legal fee loans work differently. They’re specifically designed to allow you to borrow what you need, when you need it. Unlike some other loans, you don’t need to draw down the full amount upfront. And you only need to repay the loan once you’ve received your property settlement. Plus, you only pay interest on what you use.
It’s a form of asset-based lending, helping you unlock cash tied up in your assets by securing them against your loan. But that doesn’t mean you have to own real estate – other assets, like funds in trust, may be used in some circumstances.
What can I use the funds for?
If you’re wondering more specifically what a legal fee loan is for, the good news is, it isn’t just a loan for legal fees – it’s there to help you cover all of the costs associated with the legal process.
That can include a wide range of associated third-party costs like:
- Your barrister
- Accountants to investigate the total value of the asset pool, complicated structures and asset protection schemes
- Non-confrontational alternative dispute resolution (ADR) like mediation, arbitration and pre-action procedures
Anything that is connected to the matter can be covered. It can also be used for personal reasons, such as paying for a financial planner or making home improvements prior to putting the property on the market.
How much can I borrow?
With a legal fee loan, you can borrow between $25,000 and $400,000 – usually up to 30% of the expected property settlement. You won’t face any repayments until the division of your property is complete.