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Choosing The Best Lawsuit Loan Company

We live in a culture where people are eager to take out loans for so and so purposes. Generally, many of us prefer to not take out loans due to the debt that comes with them. The reality of the situation is that if you have a house a car or have studied in an educational institution, you most likely have a loan and are in debt. There are also other types of loans that exist and that most people are not aware of, loans that can help you get through a lawsuit. Pre-settlement funding or a lawsuit loan is an advance against your future settlement of pending awards, varying from personal injury to commercial litigation. A settlement advance is also known as a non-recourse financing agreement. This means that if you lose your case there is no further obligation to pay the company back. Lawsuit loans are investments into the outcome of your lawsuit. We, the pre-settlement funding company, are advancing your money because we think your case is strong enough to win and pay us back. 

After reading this article, we will let you decide whether receiving a lawsuit loan is worth it for you so you ensure you choose the best pre-settlement loan company.

The actual definition of a lawsuit loan

According to investopedia, for victims waiting to receive class-action payments, a lawsuit settlement loan may seem like a quick and easy solution to their financial woes. A type of advance funding, a lawsuit settlement loan (sometimes called lawsuit financing or pre-settlement funding) is a cash advance from your pending settlement proceeds.

  • Lawsuit loans are based solely on the merits and outcome of your case.
  •  If you don’t win you do not have to repay the funds. 
  • Lawsuit loans can be approved in as little as 24 hours and funds are repaid directly by your attorney when your settlement check arrives.

How does lawsuit funding work?

Once the complaint of your lawsuit has been filed, it’s easier to proceed with a lawsuit advance as our underwriters rigorously evaluate your case, and the council is contacted to verify all information of the case. Once approved, the plaintiff and attorney receive a contract, if signed by both parties, the approval amount will be either wired the same day or sent via a certified check the next day. 

Is pre-settlement funding a good idea?

Lawsuit loans, or as the finance industry calls it, legal funding, are advances against your upcoming settlement. The bottom line is those who are involved in lawsuits and want to keep their suits going in order to settle their case for a better award, would take out a settlement advance which helps the plaintiff take care of bills and personal matters while their case is taken to trial (oftentimes). People involved in personal injury lawsuits would use a lawsuit loan more than others involved in different types of lawsuits. If you suffered a personal injury, then you know how accidents can really make an impact in your life manifesting in financial chaos. 

The number of loans that companies approve against your lawsuit settlement

A lawsuit funding company takes a large amount of risk when it invests in a case. Because each case has a different level of risk involved, not every case qualifies for funding. Many plaintiffs apply to multiple different funding companies because each firm has different risk and case guidelines that they follow. Our underwriters are there to ensure that if we invest in your case it will have a good chance of settling for much more than your advance amount.

You can get more funding with a previous lawsuit advance

Having a previous advance does not automatically disqualify you from receiving a new advance. The underwriting process is the same as above but we will also request a formal payoff letter from the funding company that provided your last advance. The amount of that previous lawsuit advance will factor into our ability to approve your application. If approved we will pay off your previous funder and provide you with the funding you applied for all at the same time. 

The actual cost of a lawsuit loan company

The highest amount every legal funding company will advance you is 10% of what your case is worth at the moment – if approved. The size of your lawsuit and other crucial unique information to your case will be the key to advancing you with the funds you need. Baker Street Funding funds from its own private fund, and if we deny you we work with companies that can offer to fund between $500 – $5,000,000 + depending on the details of your claim. Always consider in your search for financing is the rate that is being charged. Every company charges a different rate and sometimes a second opinion could save you thousands of dollars in the long run. You also must understand simple vs. compounding interest. If you are being charged simple interest, you are only paying a rate of return on the principal amount that you take out. If you are being charged compounding interest, you are paying a rate of return on the principal and the interest that has already accrued. In simple terms, it is better to have a contract with simple interest.

Why insurance companies don’t want you to use lawsuit funding companies

Insurance companies are businesses and at the end of the day want to settle your claim for as little money as possible. An interesting article in the Guardian explains it well. How insurance companies defraud us. A lawsuit advance with Baker Street Funding gives you the power to pay your bills and fight for the insurance settlement you deserve. If an insurance company is bullying you into settling for much less than you deserve, know that you now have a choice, you can apply for pre-settlement funding and afford the long debilitating wait. Don’t let the insurance company bully you into a small settlement. 

Paying back the pre-settlement loan company

The payment (or bill) is not paid while your lawsuit is pending; instead, the payment is paid by your attorney when your settlement award is due. Your attorney will be dealing with our company for a re-payment arrangement. Some clients will say: “but the rates can be higher than average loans”. And we say, if your case loses, you, the plaintiff, are in no debt with us, you walk away with the money. We will not bill you. That’s the risk we take.

Calculating your lawsuit loan repayment

When a plaintiff is injured and unable to pay bills or living expenses, they often turn to lawsuit loans for relief. A lawsuit loan provides upfront cash to plaintiffs in personal injury cases, in return for repayment, including an agreed-upon rate of return, when the case finally settles. Typically these transactions are non-recourse, meaning that they do not have to be repaid if the case does not settle. If your settlement takes a long time to arrive, or your litigation is extended you may find that you owe the company that provided you with the loan a substantial amount of money. While lawsuit funding companies do take an immense amount of risk when they invest in your case, there are some ways to protect yourself and make sure you get the best deal possible.

Are there any risks to getting a pre-settlement loan? 

While initially, a lawsuit advance can seem like a low-risk transaction for the plaintiff, that is hardly actually the case. As mentioned above, most companies charge a rate of return. Some companies charge this rate monthly, while others charge bi-annually and annually depending on your case. This means that every month your case drags on, you could potentially be paying back more money. It is imperative to speak with your attorney and get a realistic timeline on when your case is estimated to settle. This way you can use that estimate when you look at the fee schedule on the contract (usually on the first or second page) and calculate a rough estimate of what you will have to pay back. Most companies are extremely transparent with their fees and it should be extremely easy to determine. If you find that fees are hidden, or the fee schedule is hard to understand, or if the reviews are bad and they have a bad reputation on the news, that could be a sign that you are working with a less than reputable funding company.

Getting a second opinion on your lawsuit settlement cash advance

It is ALWAYS best to get a second opinion or offer on your lawsuit loan. A quick way to see if you are working with the right company is to ask them if they have any issue with you getting a second opinion. If their answer is anything but “no” you should absolutely steer clear. As mentioned above different companies charge different rates on different cases, so it is always best to get a second opinion so you pick the best lawsuit funding company for your time in need.

Processing fees 

While researching lawsuit loan contracts for this article (through our whistleblowers) we came across something extremely interesting. One pre-settlement funding company who is very well known in the industry now had a clause in their contract stating that if you wanted to get additional funding through another provider, you had to pay back 200% of the borrowed amount, regardless of how long ago you took out the loan. A company that tries to do this is less than ethical, to say the least. Reputable lawsuit funding companies will have no problem letting other funders buy them out at the current rate and do not charge penalties to do so. If you see this language in your contract run as fast as you can.

If you are in need of an urgent lawsuit loan, you can get help now from a top lawsuit funding company today

  • You can get your family back on track with lawsuit funding.
  • Case funding can help you pay for utility bills and more.
  • A settlement loan can help you pay past-due medical bills
  • If your family is in need and you can no longer can wait for your award, apply for a lawsuit settlement loan and get the help you need tomorrow.
  • Whatever your situation is, you can get a loan or a cash advance on your pending settlement.

Lawsuit lending is a relatively new industry and with any new industry, there are companies that try to take advantage of people. The best thing to do is to make sure you are working with a company that has good reviews, and that you feel comfortable with. With a little bit of research and the right company to partner with, you can have a great experience with a lawsuit loan.

About Baker Street Funding

Baker Street Funding helps people achieve financial ease to realize their settlement success. Our legal funding products give out more than 34,000 clients fast access to tools so you can Get Your Legal Funds Now®. Baker Street Funding approval methods come with critical essentials for getting ahead, including higher approvals when plaintiffs need it in connection to thriving customer service of like-minded people that understand litigation finance. For more information, visit 

* This post is for educational and informational purposes only. Please consult your attorney and your financial and tax advisors before making any decisions. Terms and conditions can be found at

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