Lawsuit Funding Basics
How Does Lawsuit Funding Work?
Educational content — not legal or financial advice.
Lawsuit funding gives plaintiffs with a pending legal claim access to a portion of their expected settlement or judgment before the case resolves. Unlike a conventional loan, it is typically structured as a non-recourse advance — meaning repayment comes only from the proceeds of your case, not from your other income or assets.
The Basic Process
You apply and provide basic information about your case and attorney. The funding company contacts your attorney to confirm representation and gather case details, such as the nature of the claim, insurance information, and current stage of litigation or negotiation.
An underwriter reviews the estimated strength and value of your case. If approved, you receive an offer outlining the amount, terms, and total cost. If you accept and sign, funds are typically sent directly to you.
How Repayment Works
Repayment happens only if and when your case resolves — through a settlement or judgment. Your attorney is generally responsible for repaying the funding provider directly from the proceeds at the time of disbursement, per the terms of your agreement.
Why It's Different From a Traditional Loan
A conventional loan generally requires repayment regardless of what happens in your case, and approval typically depends on credit and income. Non-recourse lawsuit funding is evaluated based on your case, and if you do not recover, you are typically not required to repay it out of pocket — subject to the specific terms of your agreement.
Frequently Asked Questions
Who repays the funding company — me or my attorney?
This is typically handled by your attorney directly from settlement or judgment proceeds, per the terms of your specific agreement.
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