Waiting for Money From an Accident Claim? Here’s How to Cope

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Getting in an automobile accident can be expensive — even if you’re not at fault.

Car accident loans could be an option to cover costs in this case because even though you might be reimbursed ultimately, many initial expenses such as car rentals, doctors visits, and repairs come out of your pocket. You also have to consider the cost of missing work to attend various appointments.

If you don’t have the money to cover these immediate expenses, you could find yourself in a tough situation. Here are some ways to bridge the gap between when the accident occurs and when your insurance settlement money comes through.

1. Borrow from friends and family

If you have family or friends who could lend you money, you might consider setting up a payment plan with them. Borrowing money from people you know can be awkward, but there are strategies that can help you avoid drama.

Some people tap friends and family by setting up a crowdfunding campaign for their medical bills. Check out tips on how to create a successful crowdfunding campaign.

2. Use a low-interest credit card

You might consider opening a low-interest credit card and using it to cover accident-related expenses while waiting for your settlement. If you open a card with a low introductory rate, such as a 0% APR during a promotion period, you could charge all your expenses to this card and pay it off with your settlement money.

However, be careful of how long it might take for your settlement to come through. If the introductory rate expires while you’re waiting for your check, you could be in a doubly stressful situation.

3. Consider a personal loan

A personal loan might offer another solution for your accident-related expenses. Getting a personal loan to cover your accident costs is different from taking out car accident loans or insurance settlement loans.

A personal loan is a general loan that provides funds you can use for almost anything.

If you get approved for a low interest rate and choose a multiyear term, you’ll have less stress about how long the accident claim might take because you won’t have to worry about the interest rate going up like you would with a credit card promotion. You do, however, have to make monthly payments.

If you choose a personal loan with no prepayment fees, you can repay the entire amount when your accident claim is settled. Lenders such as SoFi and Upstart don’t charge a penalty for early payment.

This option could be useful if you have good credit and can afford to make monthly loan payments from the time you sign for the loan to when your insurance check comes through.

4. Try to avoid car accident loans

You might see advertisements for car accident cash advances or insurance settlement loans, which use your upcoming settlement as security on the amount you borrow. The lenders know you expect to receive a lump sum, and they’re willing to lend you money based on the estimated settlement amount.

This option is available if you have bad credit and don’t qualify for a low-interest credit card or a personal loan. You also don’t have to make monthly payments, so if your budget is tight, it won’t be impacted.

But this option is very expensive because the lender will charge a fee, which can be hard to find without going through the application process. Many small, not necessarily reputable lenders offer such loans. Some lenders that offer car accident loans aren’t upfront about interest rates and fees.

In general, you’re better off avoiding this product and trying to make the first three options work.

Keep detailed records

It’s of critical importance to develop a system for keeping track of all your expenses related to the accident. Your insurance adjuster will want to know what you paid for and why as they go through the process of adjusting your claim.

A simple way to monitor your accident-related expenses is to list them on a spreadsheet — and don’t forget to save all the receipts in a handy place, including those related to your health expenses. Be sure to take photographs of any damage to your vehicle and property.

You also should keep up-to-date notes about your physical condition. It can be helpful to keep a journal of injury symptoms as well as have written correspondence with your health care providers that you can give the insurance adjuster for reference.

Create an emergency fund for the future

There are ways to find money after an accident when you need it, but it’s best to start saving toward an emergency fund so you have a financial cushion if disaster should strike. Once you get through these tough times and can take a breather, start thinking about how to create a healthy emergency fund for future expenses.

You will want to do two important things:

  1. Determine how much money should be in your emergency fund. The amount will depend on many factors, such as whether you rent or own a home, what your monthly expenses look like, and how worried you are about long-term issues that could prevent you from working.
  2. Pick a suitable process for saving money. There are many different savings plans, so find the one that’s right for you and commit to setting aside money consistently.

The most important thing to focus on after an accident is getting yourself back to good health. The stress of wondering how you’ll afford all the costs associated with the accident can stall your recovery. Find a solution that works for you and helps alleviate that stress so you can let your body heal.

Interested in a personal loan?

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Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print to help you understand what you are buying. Be sure to consult with a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time.

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print to help you understand what you are buying. Be sure to consult with a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time.

RATES (APR)loan amount
5.99% – 17.88%1 $5,000 to $100,000
5.69% – 35.99% $1,000 to $50,000
6.98% – 35.89%* $1,000 to $50,000
99.00% – 199.00%2 $500 to $4,000
5.99% – 24.99%3 $5,000 to $35,000
5.99% – 29.99%4 $7,500 to $40,000
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1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

  1. Fixed rates from 5.99% APR to 17.88% APR (with AutoPay). Variable rates from 6.49% APR to 14.70% APR (with AutoPay). SoFi rate ranges are current as of November 4, 2019 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. See APR examples and terms. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 6.49% APR assumes current 1-month LIBOR rate of 1.81% plus 3.08% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.
  2. To check the rates and terms you qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull.
    See Consumer Licenses.
  3. Minimum Credit Score: Not all applicants who meet SoFi’s minimum credit score requirements are approved for a personal loan. In addition to meeting SoFi’s minimum eligibility criteria, applicants must also meet other credit and underwriting requirements to qualify.
  4. If you lose your job through no fault of your own, you may apply for Unemployment Protection. SoFi will suspend your monthly SoFi loan payments and provide job placement assistance during your forbearance period. Interest will continue to accrue and will be added to your principal balance at the end of each forbearance period, to the extent permitted by applicable law. Benefits are offered in three month increments, and capped at 12 months, in aggregate, over the life of the loan. To be eligible for this assistance you must provide proof that you have applied for and are eligible for unemployment compensation, and you must actively work with our Career Advisory Group to look for new employment. If the loan is co-signed the unemployment protection applies where both the borrower and cosigner lose their job and meet conditions.
  5. Terms and Conditions Apply: SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)
2 Includes AutoPay discount. Important Disclosures for Opploans.

Opploans Disclosures

Direct Deposit required for payroll.

Opploans currently operates in these states: . *Approval may take longer if additional verification documents are requested. Not all loan requests are approved. Approval and loan terms vary based on credit determination and state law. Applications processed and approved before 7:30 p.m. ET Monday-Friday are typically funded the next business day.

  1. To qualify, a borrower must (i) be a U.S. citizen or permanent resident; (ii) reside in a state where OppLoans operates; (iii) have direct deposit; (iv) meet income requirements; (v) be 18 years of age (19 in Alabama); and, (vi) meet verification standards.
  2. NV Residents: The use of high-interest loans services should be used for short-term financial needs only and not as a long-term financial solution. Customers with credit difficulties should seek credit counseling before entering into any loan transaction.

  3. OppLoans performs no credit checks through the three major credit bureaus Experian, Equifax, or TransUnion. Applicants’ credit scores are provided by Clarity Services, Inc., a credit reporting agency.

  4. Based on customer service ratings on Google and Facebook. Testimonials reflect the individual’s opinion and may not be illustrative of all individual experiences with OppLoans. Check loan reviews.

  5.  

    Rates and terms vary by state.

3 Includes AutoPay discount. Important Disclosures for Payoff.

Payoff Disclosures

  1. All loans are subject to credit review and approval. Your actual rate depends upon credit score, loan amount, loan term, credit usage and history. Currently loans are not offered in: MA, MS, NE, NV, OH, and WV.
4 Important Disclosures for FreedomPlus.

FreedomPlus Disclosures

  1. All loans available through FreedomPlus.com are made by Cross River Bank, a New Jersey State Chartered Commercial Bank, Member FDIC, Equal Housing Lender. All loan and rate terms are subject to eligibility restrictions, application review, credit score, loan amount, loan term, lender approval, and credit usage and history. Eligibility for a loan is not guaranteed. Loans are not available to residents of all states – please call a FreedomPlus representative for further details. The following limitations, in addition to others, shall apply: FreedomPlus does not arrange loans in: (i) Arizona under $10,500; (ii) Massachusetts under $6,500, (iii) Ohio under $5,500, and (iv) Georgia under $3,500. Repayment periods range from 24 to 60 months. The range of APRs on loans made available through FreedomPlus is 5.99% to a maximum of 29.99%. APR. The APR calculation includes all applicable fees, including the loan origination fee. For Example, a four year $20,000 loan with an interest rate of 15.49% and corresponding APR of 18.34% would have an estimated monthly payment of $561.60 and a total cost payable of $7,948.13. To qualify for a 5.99% APR loan, a borrower will need excellent credit on a loan for an amount less than $12,000.00, and with a term equal to 24 months. Adding a co-borrower with sufficient income; using at least eighty-five percent (85%) of the loan proceeds to directly pay off qualifying existing debt; or showing proof of sufficient retirement savings, could help you also qualify for the lowest rate available.
* Important Disclosures for Upgrade Bank.

Upgrade Bank Disclosures

* Personal loans made through Upgrade feature APRs of 6.98%-35.89%. All personal loans have a 1.5% to 6% origination fee, which is deducted from the loan proceeds. Lowest rates require Autopay and paying off a portion of existing debt directly. For example, if you receive a $10,000 loan with a 36-month term and a 17.98% APR (which includes a 14.32% yearly interest rate and a 5% one-time origination fee), you would receive $9,500 in your account and would have a required monthly payment of $343.33. Over the life of the loan, your payments would total $12,359.97. The APR on your loan may be higher or lower and your loan offers may not have multiple term lengths available. Actual rate depends on credit score, credit usage history, loan term, and other factors. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. There is no fee or penalty for repaying a loan early. Personal loans issued by WebBank, Member FDIC.

** Accept your loan offer and your funds will be sent to your bank via ACH within one (1) business day of clearing necessary verifications. Availability of the funds is dependent on how quickly your bank processes this transaction. From the time of approval, funds should be available within four (4) business days.

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