Pre-Settlement Funding: Frequently Asked Questions
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Throughout this page, you may see terms like pre-settlement funding, litigation funding, lawsuit loan, legal financing, and litigation financing used interchangeably. These terms all reference the same type of nonrecourse cash advance that we provide to qualified plaintiffs who need financial support while fighting their civil cases.
Understanding Legal Funding
What is legal funding?
Legal funding—which can go by many names, including but not limited to litigation funding, pre-settlement funding, and legal financing—is a cash advance provided to plaintiffs involved in lawsuits, most commonly personal injury cases. This type of funding is nonrecourse, meaning repayment is only required if the case ends in a successful settlement or judgment. It’s not a traditional loan and doesn’t depend on your credit score or employment status. Legal funding gives plaintiffs the financial flexibility to cover essential expenses while pursuing fair compensation through the legal process.
What is pre-settlement funding?
Pre-settlement funding, sometimes called a “lawsuit loan,” is a cash advance provided to plaintiffs by litigation funding companies before a case is resolved. It allows plaintiffs to access a portion of their expected settlement upfront. This can relieve financial pressure and give clients the time they need to pursue a fair outcome—without having to settle early for less than they deserve.
What is post settlement funding?
Post-settlement funding provides financial support after a case has settled but before the funds are officially disbursed. Since it can take weeks or months to receive a payout, this type of funding helps plaintiffs bridge the gap and meet immediate financial needs without delay.
How does pre settlement funding work?
The pre-settlement funding process starts with you providing some basic information to us via the form on our website. We then work directly with your attorney to evaluate your case’s strength and potential value when deciding whether to advance the funds. If approved, the client (you) receives a cash advance—often within 24 business-day hours—which you can use on whatever you need to make ends meet. The advance is nonrecourse, so if the case doesn’t result in a win or settlement, the client owes nothing.
Is a settlement advance the same as a bank loan?
A settlement advance is different from a bank loan. The biggest difference is that you don’t have to pay back a settlement advance if you lose your case, whereas with a bank loan, you must pay back the loan amount.
Additionally, bank loans typically require monthly payments. A settlement advance does not; it is repaid directly from your settlement.
Finally, a settlement advance differs from a bank loan in that bank loans are typically granted based on employment status, credit history, or assets. Litigation funding companies do not look at these factors when considering an application for a settlement advance; rather, litigation funding companies look at the merits of the case, the likelihood of success, and the amount of the potential settlement.
How does pre-settlement funding and post-settlement funding assist law firms?
The settlement advance provided by pre-settlement funding and post-settlement funding removes the financial burden from plaintiffs, allowing their attorneys to fight for a fair settlement for them. The plaintiffs are better able to withstand what is sure to be a long litigation process, and plaintiffs’ lawyers working on a contingency fee basis are able to benefit by negotiating a larger settlement.
The larger settlements not only benefit attorneys financially but also by reputation, as attorneys who successfully negotiate large settlements for their clients receive future business from the client as well as referrals.
Eligibility & Case Qualifications
Who is eligible for pre-settlement funding?
Anyone who is involved in a personal injury lawsuit with a mature claim is eligible for pre-settlement funding. This means the plaintiff is seriously injured, has a lawsuit with strong merits against the defendant, and is represented by an attorney on a contingency basis.
What types of cases qualify for pre-settlement funding?
There are many different types of cases that are eligible for pre-settlement funding, including:
What are pre-settlement funding requirements?
In order to be considered for litigation funding, the plaintiff needs to have retained an attorney and filed a lawsuit or (will soon be filing a lawsuit) in the applicable court of law.
Can I get pre-settlement funding without my attorney's consent?
No. Because of the nature of litigation funding, you need an attorney to be eligible for a pre-settlement advance. We work closely with your attorney to find the best plan for you, and your attorney will provide a guideline regarding the amount of your expected settlement and the value of your case, which we base our settlement advance amounts upon.
Do I need credit check for a lawsuit loan?
No, you do not need a credit check to obtain a lawsuit loan from USClaims. Our funding is based solely on the merits of your lawsuit and the likelihood of a successful settlement—not your credit score, employment status, or income. Plus, applying won’t impact your credit.
Why would a pre settlement loan be denied?
Pre-settlement funding may be denied if certain criteria aren’t met. The most common reason is if you don’t have legal representation, since your attorney must be involved in the case and agree to the funding. Additionally, your case needs to have clear liability and a likelihood of a successful resolution. If the potential settlement is too low or the case is still in the early stages with limited documentation, we may not be able to proceed.
How many pre-settlement loans can I get?
You can apply for multiple rounds of pre-settlement funding if your case supports it. Each request is evaluated based on your case’s current value, stage, and any previous advances. We work closely with your attorney to ensure the total amount funded remains reasonable in relation to your expected settlement. This protects you from overfunding and ensures you keep as much of your settlement as possible.
What states do you provide funding in?
USClaims proudly provides pre-settlement funding in almost every U.S. state. Due to state laws and regulations, we are not able to provide litigation funding in Montana, Arkansas, Kentucky, Washington D.C., West Virginia, and Maryland.
Funding & Settlement Process
How do I apply for a lawsuit loan?
Submitting a request for litigation funding is simple. Give us a call or fill out the form on our website to get started. We’ll ask you a few questions about your case and then work directly with your attorney to get the ball rolling.
How long does settlement take?
The length of a settlement varies based on the complexity of the case, negotiations, and court schedules. Some cases settle within a few months, while others can take years, especially if liability is disputed or multiple parties are involved. Your attorney is the best source for specific timelines.
How long does it take to get cash?
Once your application is approved and the purchase agreement accepted, you can receive your settlement advance in as little as 24 business-day hours*.
Can I get an advance on my settlement check?
Yes, you can obtain a nonrecourse advance on your anticipated settlement check through USClaims. This allows you to access a portion of your future settlement before your case concludes. It’s not a loan—if your case is unsuccessful, you owe nothing. This advance can be used for essentials like rent, utilities, or medical bills, helping relieve financial pressure while your attorney negotiates for the full value of your claim.
How long does it take to get a settlement check?
Once your case settles, it can still take several weeks to receive your actual settlement check. The delay often comes from processing paperwork, satisfying liens, court approval (if required), and distributing funds. Your attorney usually handles these steps and disburses your portion after deducting legal fees and other obligations. If you’re facing financial hardship during this period, USClaims can help with post-settlement funding so you don’t have to wait to access your money.
How are settlement checks mailed?
Settlement checks are typically mailed by the defendant’s insurance company to your attorney’s office. This process can take anywhere from a few days to several weeks depending on the insurer’s processing time and mailing method. Once your attorney receives the check, they deposit it into their trust account, pay any outstanding liens or fees, and then issue your portion. If delays occur, your attorney can provide updates on expected delivery and release.
Can a settlement check be direct deposited?
In most cases, settlement checks cannot be direct deposited to you from the insurance company. Typically, the funds are sent via check to your attorney, who then deposits it into their escrow account. After legal fees, liens, and other expenses are handled, your attorney may offer to direct deposit your remaining portion or issue you a check, depending on their office procedures. If you need quicker access to funds, post-settlement funding may be an option.
Are same day pre-settlement loans available?
Yes, same-day pre-settlement funding may be available through USClaims. Once we receive the necessary case details and legal documentation, we move fast. Most approved clients receive funds within 24 business-day hours.* Timing may vary based on how quickly we receive everything needed, but we’re committed to helping you access funds as fast as possible when you’re facing urgent financial needs.
When do I have to pay the money back?
Repayment only happens if your case successfully settles. There are no monthly payments, no hidden fees, and no out-of-pocket risk. If your case is unsuccessful, you owe nothing. When your settlement check is issued, your attorney will pay USClaims directly from the proceeds before distributing the remaining amount to you.
How Funds Can Be Used
How can pre-settlement funding be used?
Plaintiffs can use pre-settlement funding to pay for anything, including day-to-day expenses like rent, utilities, and groceries. You can also use the funds to cover loan or credit card payments, medical bills, and repairs.
Without litigation funding, many plaintiffs may find themselves homeless, have to pull their children out of college, or have their vehicles repossessed.
Are there restrictions on how the funds can be used?
No. Pre-settlement funding and post-settlement funding carries no restrictions on its use and can be used for personal expenses like housing, food, medical bills, tuition, business costs, and utilities.
Costs, Fees & Repayment
What is nonrecourse?
Nonrecourse means you only repay the funds if your case is successful. If your lawsuit doesn’t settle or you lose in court, you owe nothing. This type of funding is not a loan in the traditional sense—it’s a risk-free cash advance tied solely to the outcome of your case.
How much am I eligible for?
The typical plaintiff applying for and receiving a settlement advance is eligible for approximately 10 percent of the value of the case, which can vary depending on the injury sustained. We work with your attorney to determine the best plan for you.
Use our pre-settlement loan calculator to get a better idea of how much money you could be eligible for.
How much does pre settlement funding cost?
Costs vary based on case strength, duration, and funding amount, but USClaims keeps it simple and transparent. We offer non-compounding, capped interest rates, which means you’ll never owe more than twice the amount you were advanced, no matter how long your case takes. There are no hidden fees, no application costs, and you owe us nothing unless your case resolves in your favor.
What are pre-settlement funding interest rates?
Pre-settlement funding interest rates refer to the cost of borrowing money against a pending lawsuit settlement. These rates are typically expressed as a percentage and can be either simple (applied to the original amount only) or compounding (interest calculated on both the principal and any previously accrued interest).
Rates vary widely by company and case type, often ranging from 27% to over 100% annually, depending on the risk level and expected duration of the case. Because this type of funding is nonrecourse, interest rates tend to be higher than traditional loans.
USClaims has some of the lowest, non-compounding rates in the industry. Other companies may offer services that resemble our pre-settlement funding options, but we pride ourselves in offering low rates and fees with no hidden surprises.
How does pre-settlement funding affect my attorney fees?
Pre-settlement funding does not increase your attorney’s fees. Your lawyer will still receive their standard contingency fee as outlined in your agreement.
What if we lose our case – do we still have to pay you back?
Because litigation funding is a nonrecourse method of financing, if you lose your case, you do not have to pay back the advance. The only reason you would be required to pay back an advance is if you provided false information, committed fraud, or breached the purchase agreement.
How much does it cost to sue someone?
The cost of filing a lawsuit varies depending on the type of case, location, and attorney fees. Filing fees alone can be tens, hundreds, or thousands of dollars, with additional costs for service of process, expert witnesses, and court reporters. Most personal injury attorneys work on a contingency basis, meaning they only get paid if you win your case. However, day-to-day living expenses while waiting for your case to resolve can still add up—which is where pre-settlement funding can help.
What happens if you sue someone with no money?
If the defendant has no money or assets, collecting a judgment can be difficult. However, in many personal injury cases, it’s the defendant’s insurance company that pays the settlement, not the individual. Your attorney will assess whether there’s viable insurance coverage or collectability before moving forward. Pre-settlement funding decisions also consider the likelihood of recovery, so we’ll work with your legal team to understand the full picture before approving any advance.
Choosing a Legal Funding Company
How do you compare pre-settlement funding companies?
To compare pre-settlement funding companies, look at a few key factors: interest rates (preferably non-compounding), fee transparency, and whether they offer a nonrecourse structure—meaning you owe nothing if you lose your case.
Review their funding cap policy (or lack of one), funding speed, and reputation. Check online reviews, Better Business Bureau ratings, and how long they’ve been in business. Ask for a full breakdown of fees and repayment terms before signing anything. Ethical companies like USClaims will be upfront and clear about all costs and timelines.
How do you choose the best pre-settlement funding company?
The best pre-settlement funding company will offer a transparent, ethical, and risk-free solution tailored to your needs. Look for companies that cap repayment amounts, use simple interest, and don’t charge upfront fees.
A long-standing track record, strong attorney relationships, and fast funding are also important. Customer reviews and attorney recommendations can help confirm credibility. Ultimately, the best provider empowers you to pursue fair compensation without pressure, hidden fees, or compounding debt.
Have Questions?
Our pre-settlement funding experts will walk you through our entire process.
Disclaimer: Throughout this website, the term “loan” may be used for convenience to describe pre-settlement funding. However, such transactions are not loans in the legal sense. Repayment is strictly contingent upon the successful resolution of your case. If your case is unsuccessful, no repayment is required. Common terms like “lawsuit loan” are used colloquially but misrepresent the nonrecourse nature of pre-settlement funding.
