What is a settlement cash advance?
A settlement cash advance (known as litigation funding) is essentially an advance on your future settlement that gives you instant access to cash while you wait for your claim to be adjudicated or finalized. For plaintiffs, these advances are designed to help you cover immediate needs such as medical debt, transportation, rent, and other expenses that are almost guaranteed due to a major accident. For attorneys, you can gain much-needed capital, enabling you to cover everyday costs while working with the other party on agreeing to pay out the damages. In general, settlement advance funding may also be a good idea if the defendant offers a much lower payout than the fair value of your claim.
A settlement advance uses your pending compensation payout as collateral, meaning it is non-recourse and is not considered to be a traditional loan or a bank loan. Funding companies only get repaid if you recover monetary compensation empowering you to unlock some of the future value of your case to get you through the wait at no risk.