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Can I Get a Settlement Advance on a Pending Lawsuit?

When involved in a lawsuit, the financial burden can become overwhelming. Legal battles often stretch over long periods, causing significant financial strain due to medical expenses, loss of income, or other related costs. This situation leads many to wonder, "Can I get a settlement advance on a pending lawsuit?"

The answer is yes, and is commonly referred to as pre-settlement funding, lawsuit funding or a settlement advance. This article explores the intricacies of obtaining lawsuit funding, including what it entails, eligibility requirements, benefits, potential downsides, and critical considerations.

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Understanding Settlement Advances

Lawsuit funding offers a financial buffer to plaintiffs in the midst of a legal battle by providing them with a portion of their expected lawsuit settlement upfront. These are not traditional loans in the conventional sense because their repayment is contingent upon the outcome of the case. If the plaintiff does not win the case or settle, they are not obligated to repay the advance. This non-recourse nature differentiates settlement advances from standard loans, where repayment is expected regardless of the lawsuit's outcome.

Eligibility for a Settlement Advance

Eligibility for a settlement advance primarily depends on the nature of the lawsuit and its potential for a favorable settlement. Here are key factors considered:

  1. Type of Lawsuit: Settlement advances are more common in personal injury, workers' compensation, wrongful death, and product liability cases. However, companies may offer funding for a wide range of legal battles, depending on the case's merits.
  2. Case Merit: Funding companies conduct a thorough review of each case to assess its strength and the likelihood of a successful outcome. Cases with clear liability and significant damages are more likely to qualify.
  3. Lawyer Representation: Typically, plaintiffs must be represented by an attorney on a contingency basis to be eligible for a settlement advance. This requirement ensures that the funding company has a legal professional to communicate with and that the case is taken seriously.

Benefits of Settlement Advances

  1. Immediate Financial Relief: Settlement advances provide crucial financial support, helping plaintiffs manage living expenses, medical bills, and other costs during lengthy legal proceedings.
  2. No Repayment if You Lose: Since the repayment of the advance is contingent on winning the case, there is no obligation to repay if the plaintiff loses.
  3. More Time for Negotiation: With financial pressures alleviated, plaintiffs can afford to wait for a more favorable settlement rather than feeling compelled to accept a lower offer quickly.

Drawbacks of Settlement Advances

  1. Limited Regulation: The pre-settlement funding industry lacks the comprehensive regulation seen in traditional lending, leading to variability in terms and costs.
  2. Potential Impact on Case Strategy: Taking an advance may influence the plaintiff's decisions regarding their case, including their willingness to settle or proceed to trial.

Choosing a Settlement Advance Provider

  • Conduct Thorough Research: Look for reputable providers with transparent practices. Reviews and recommendations, especially from your attorney, can be invaluable.
  • Understand the Agreement: Fully comprehend the repayment terms, interest rates, and any fees involved before committing to an advance.

Legal Considerations

It's essential to involve your attorney in the decision-making process. They can provide insights into how a settlement advance might affect your lawsuit and advise on the best course of action. Additionally, your attorney can help negotiate terms and ensure that the agreement aligns with your interests.


Settlement advances provide a vital financial lifeline for plaintiffs struggling with the prolonged timelines and uncertainties of legal proceedings. They offer immediate financial relief without the risk of repayment if the lawsuit does not result in a favorable outcome. However, the decision to secure a settlement advance should be approached with caution. By thoroughly researching providers, comparing offers, and consulting with your attorney, you can make an informed decision that supports your financial well-being and legal strategy.

The information is provided for educational and informational purposes only. Such information or materials do not constitute and are not intended to provide legal, accounting, or tax advice and should not be relied on in that respect. We suggest that You consult an attorney, accountant, and/or financial advisor to answer any financial or legal questions.