Borrowing Money Against A Lawsuit

Settlement funding is a type of loan that is given to plaintiffs in personal injury lawsuits. These advances help plaintiffs with financial needs before settlement.

Borrowing Money Against A Lawsuit< - If you're considering borrowing money against a lawsuit, learn about the process and potential benefits and drawbacks first.
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Borrowing Money Against A Lawsuit

Serious injuries caused by an accident that was the fault of someone else takes a physical and emotional toll. An accident that forces you to miss time from work while undergoing medical treatment and recovering from the injuries takes a financial toll. The loss of income makes it difficult and, sometimes, impossible to meet financial obligations while waiting for a settlement or jury award from a lawsuit.

A lawsuit loan may offer the solution to financial challenges by giving you an advance against the settlement. It sounds good, but you probably have questions about how pre-settlement funding works, who offers it, and how much it costs.

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You want to get a fair settlement from your personal injury claim that adequately compensates for the harm you endured. It needs to pay for the medical expenses, lost wages and other losses, including the pain and suffering you endured because of an accident that someone else caused.

The problem is that lawsuits take time. The longer it takes to reach a settlement, the more likely that an accident victim will struggle to meet financial obligations, including paying for food, shelter and other household expenses. Insurance companies exploit financial hardship to pressure plaintiffs into taking a settlement that is worth substantially less than simply by delaying and prolonging settlement.

Pre-settlement funding offers you an advance against the value of the settlement or jury award anticipated in your personal injury lawsuit. The money, which can be in your hands within 24 to 48 hours from approval of your application, can be used for any purpose you choose other than payment of legal fees or costs of the lawsuit.

The cost of lawsuit funding can be as low as 2.5% simple interest per month until the cash advance is repaid. Because funding is based on the value of the claim and the likelihood of a settlement or award in your favor, the funding company does ask for a credit report or employment history from you. In fact, you do not incur a personal obligation to repay the money advanced to you.

Continuing reading to learn more about how the pre-settlement funding process works to relieve financial pressures you face to give your personal injury attorney the time needed to negotiate a good settlement agreement. See how easy it can be to prevent insurance company tactics from affecting the outcome of your claim for compensation.

Get up to $500,000 With Rates as Low as 2.5% Simple, Monthly

Key Takeaways

A few of the key takeaways about lawsuit funding include:

  • Although sometimes referred to as a lawsuit loan, what you receive as a cash advance plus the interest on it is only repayable if and when you win the case through settlement or judgment.
  • Funding is available at simple interest of 2.5% to 4% a month.
  • Rates and terms differ depending on the company funding the cash advance, so shop for the best terms and rates.
  • It is essential for you to discuss lawsuit funding with your personal injury lawyer to ensure that you understand all of the terms and costs involved before moving ahead with it.
  • Because there is no personal obligation on your part to repay a lawsuit loan, your credit, employment and income are not taken into consideration in the application process.

What Is Settlement Funding?

Companies that fund cash advances based on the value of a anticipated value of a lawsuit or the value of a settlement worked out by the attorneys for the parties advertise what they offer using a variety of names, including:

  • Lawsuit loans.
  • Personal injury loans.
  • Lawsuit settlement loans.
  • Pre-settlement funding.
  • Litigation financing.
  • Lawsuit funding.
  • Lawsuit cash advances.
  • Settlement funding.

Regardless of the name a settlement funding company uses for its service, the cash advance that you receive is not a loan in the traditional sense. If you go to a bank and ask to borrow money, the focus of the review or underwriting process to determine whether to lend you the money is on your ability to repay the debt. A bank wants to see that you have a steady employment history and have sufficient income to make the monthly payments required to repay the loan amount plus interest. The lender also looks at your credit history to make sure that you repay your debts and have not defaulted on loans or credit cards in the past.

When you apply for pre-settlement funding, the company does not ask for information about your employment, income, assets owned or credit history because it is not relying on your ability to repay a debt. The focus is the following factors:

  • There must be a pending lawsuit seeking money damages on your behalf.
  • You must be represented in the lawsuit by an attorney.
  • An evaluation of the likelihood that the lawsuit will result in a settlement or award in your favor.
  • An evaluation of the value of the anticipated settlement or award.

Medical malpractice claims, wrongful death cases, and slip-and-fall injuries are only a few of the types of lawsuits eligible for pre-settlement funding. Some settlement funding companies also accept applications from plaintiffs with employment discrimination and wrongful termination claims pending in court.

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Apply today and get funds in as little as 24 hours!

What Is The Application and Underwriting Process?

You generally apply online for a loan by completing a simple application on a funding company’s website. The information requested for the application is generally limited to the following:

  • Your name and contact information.
  • The name and contact information for the attorney handling your claim for damages.
  • Basic information about the lawsuit.

The majority of information and documents, including pleadings in the case will be obtained by the funding company from your lawyer. This is why it is important to seek the advice and guidance of your lawyer when considering lawsuit funding as a solution to financial challenges that you may be experiencing.

Company evaluates the lawsuit to determine whether it qualifies for funding and notifies you and your lawyer of the terms, including interest rate. If you decide to accept the cash advance, the money can be available to you within 24 hours from when you and your lawyer agree to the terms of the offer.

How Is The Pre-Settlement Loan Repaid?

The money advanced to you along with interest due from when you received it are paid from the settlement or award in the lawsuit. When the case is resolved and the settlement check sent to your lawyer by the insurance company has cleared, your lawyer writes checks on the settlement funds to pay the following:

  • Legal fees owed to your lawyer.
  • Litigation costs related to the lawsuit.
  • Liens filed against the settlement by third parties, such as your health insurance company for medical expenses it paid.

From the remaining balance of the settlement money, your lawyer writes a check to pay the settlement funding company what is owed to it and another check to you for the net settlement proceeds remaining.

Get $500 – $500,000 in as Little as a Single Business Day!

We understand that if you’re applying for funding with us, you needed the funding yesterday. With your attorney’s cooperation, we can provide funding as soon as the same business day.

What Is The Average Rate For Pre-Settlement Funding?

Companies offering pre-settlement funding set their own terms, including the rate of interest they charge you for the cash advance. State laws protect consumers by setting the maximum rate of interest that lenders doing business in the state may legally charge.

Although a funding company could legally charge up to the maximum rate of interest allowed under state laws, the Rand Institute reports that the cost to repay an average lawsuit loan would be less than repaying the same amount of money charged against a credit card. Getting the best rate for a lawsuit loan depends on doing your homework and comparing rates offered by companies doing business in your state.

What Is The Lowest Interest Rate For Pre-Settlement Funding? offers settlement funding for as little as 2.5% simple interest per month, which means that a cash advance of $10,000 costs $250 per month in interest until it is repaid after you win the lawsuit. Some companies charge significantly higher interest rates for the service they provide.

Get up to $500,000 With Rates as Low as 2.5% Simple, Monthly

How To Find The Lowest Rate for a Personal Injury Loan

Finding the lowest rate for a settlement loan can be accomplished by contacting funding companies doing business in your state and asking them to disclose their interest rate and fees. Fees charged by a company are as important to know as the interest rate simply because you want to compare the overall cost of the money, which includes interest and fees.

Take the information that you obtain from speaking with different companies to your lawyer for help deciding on the legal funding with the best rate. It’s a good idea to let your attorney lend a helping hand by speaking to the lawsuit funding company with the best interest rate and overall cost to determine if the terms of the advance and its repayment represent the best option for you.

An important question to ask a litigation funding company is the percentage of the settlement or award it will advance to you. This is important because you need to know that it will be enough to meet your financial needs pending settlement.


Lawsuit funding may offer a good option to relieve financial strain that could be exploited by an insurance company to force you into an unfavorable settlement. The company funding the advance assumes the risk of not being repaid should you lose. offers legal funding with simple interest rates as low as 2.5%. While other companies limit the amount they will advance to 10% or 15% of the value of a settlement, approves loans for up to 50% depending on the stage of your lawsuit with the larger advances reserved for plaintiffs that have reached settlements in their cases.

Learn more by calling at (800) 340-4973. You can also get information at their website and apply online for funding of your settlement.

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Apply today and get funds in as little as 24 hours!

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