Lawsuit lending firms, which loan cash to plaintiffs before they receive settlement money, see a boost in business during the holiday season, but the loans come with interest rates that are more expensive than credit card debt, reports CNBC.
Some of the firms in the report charge annual interest rates ranging between 25 and 98 percent. The average credit card interest rate is 16.61 percent, according to Bankrate.
Regulation of the practice is largely left to the states. ILR’s Page Faulk said in the story that states like Arkansas, Indiana, and Tennessee have passed laws that limited interest rates or required more disclosure.