Unnecessary Ways To Spend Your Lawsuit Loan

Reading Time: 3 minutes

A lawsuit loan, or settlement funding, is a non-recourse loan that you can use for just about any purpose. Whether you’re seeking to pay your medical bills, cover household costs, or rent, a pre-settlement advance can help your financial situation while your personal injury case is active.

While this type of funding can be a versatile way to pay for your essential needs, there are things you shouldn’t spend your advance on. Here are some things you should avoid if you’ve been approved for a pre-settlement cash advance.

Buying or spending on things you don’t need

Spending your lawsuit cash advance on non-essential matters is not only unwise but also imprudent. Reputable funding companies frown upon frivolous spending, and if they discover that you use up the funds on unneeded things, they may deny you future borrowing opportunities for your lawsuit.

Right now, consider focusing on your basic financial needs when dealing with a personal injury lawsuit. Once you find yourself in a more stable position with a steady income and the ability to stay on top of your bills, then you might be able to spend on some of the things you want.

Don’t get into debt you can’t afford or buy things you do not need to have with little or no income during a legal battle you don’t even know you will win. No settlement is ever promised.

Keeping the money saved in the bank 

You may qualify for a lawsuit loan—from a few thousand dollars to $1,000,000—but to let it sit at the bank as savings may not be the best idea. Interest rates of the loan do accrue, and once you receive your compensation, you will have to pay that money back—plus interest. That means saving your legal funding money will only cost you more once you win.

If your goal is to have money saved for a rainy day, consider saving your money once you resolve your case and get paid. And if you are worried about money running out, you can always re-apply for a lawsuit loan to get additional cash. 

Buying a pet 

Avoid using your lawsuit advance money to buy a pet. We all know accidents can be anxiety-inducing and that having a healing companion can bring comfort. But purchasing a pet when you’re going through an injury lawsuit and feeling stressed can have negative consequences for both your wallet and shelter dogs. As animal lovers, always remember that buying a dog often means another dog may face euthanasia. Explore better options and make sure to research the adoption process before deciding on a pet.

For instance, shelters and rescue groups are dedicated to providing assistance to homeless, unwanted, and previously injured animals in need. Does this sound familiar? Opt for rescue instead of purchasing, and in doing so, you will not only aid your own recovery but also provide a chance for these animals to heal from their own pasts.


Most reputable settlement funding providers prohibit using a lawsuit loan on gambling due to the consequences for you and the lender. No matter your excuse, gambling is never a good idea. There is a difference between helping an accident victim who needs money to cover living expenses and using the funds to fulfill negative habits and activities.

Additionally, taking on a cash advance in the form of a settlement loan to gamble could throw up a red flag to the funding company that you might not settle your case due to your impulses.

Illegal activities

When you take out a pre-settlement loan, pre-settlement funding companies will likely have a clause that specifies that you can’t use the advance for illegal activities. Most reputable legal funding companies won’t fund a civil case for illegal purposes. Some of these activities include money laundering, buying drugs, or being involved in other types of crimes. 

Ultimately, litigation funding companies will not provide loans for anything against the law. They won’t endanger their businesses and face legal problems.


Is a pre-settlement loan necessary when you’re strapped for cash and need to pay rent, cover living expenses or medical bills? Yes. However, your lawsuit loan should not be used on things you do not need. Using the cash advance for purposes such as illegal activities or non-essentials could result in the lender not providing you with money.

While some pre-settlement funding companies may be more lenient on the use of the advance, you should always use precaution. Look into Baker Street Funding. Our pre-settlement funding is here to help you get out of a financial rut and back on your feet, not to contribute to further damaging habits. We provide lawsuit loans for accident victims and those involved in legal proceedings who need an immediate cash advance without the loan shark or irresponsible lender methods.

Using the loan responsibly, which means taking only what you need and using it to pay for your living expenses while the lawsuit is pending, will go a long way in ensuring that you get back on track financially.

If you need a lawsuit loan to cover your emergencies, apply for cash with Baker Street Funding today.

At Baker Street Funding, we give you the inside scoop on pre-settlement funding by covering a variety of ... financing and legal topics to help you made the best financial decision for you and for your case. Our experts break down complex ideas in a way that's easy to understand so you can stay informed on current trends as well as tips and fact checked information by the CEO and founder, Daniel Digiaimo. Furthermore, Despite its name, consumer legal funding is not a loan. If you don't win your case, no payment needs to be made back. To avoid confusion and simplify matters on, we'll use the word "loan" throughout this article.

Select a legal funding service to get started. 

Attorney Requests

Lawsuit Loans

Litigation Funding

Personal Injury Loans

Settled Case Loans

Surgery Funding

Or just call us at 888.711.3599 to apply.