Maximize Your Legal Claim With Pre-Settlement Funding: Here’s How It Works

Disclaimer: Consumer legal fundings and advances are not loans under applicable financing laws. Rockpoint’s products are non-recourse, meaning if you don’t win your case, you don’t have to pay us back. Receiving financial support in connection with a legal case is typically (and oftentimes incorrectly) referred to as a “lawsuit loan” or “loan.” Therefore, for the ease of search references, these terms may be used in this context to refer to our funding products, but we maintain our separateness from consumer loan products in all legal aspects.

You suffered a serious injury in an accident and started a claim against the responsible party. You’re working with a good lawyer who says you have a solid case. But how do you handle the mounting expenses in the months (and sometimes years) that pass until you collect your settlement?

That’s where pre-settlement funding comes into the picture. How does legal funding work? Is it a loan? When do you pay it back, and what happens if your case falls through?

Is Pre-Settlement Funding a Loan?

You may have heard the terms “legal loan” or “pre-settlement loan” used interchangeably with “pre-settlement funding.” However, pre-settlement financing isn’t a conventional loan.

Qualifying for a traditional loan depends heavily on your credit score. Before approving a loan, a financial institution will run a credit check on you. You may also need to show proof of employment and provide collateral. Lenders insist on this process because they need to know you can repay them.

In contrast, pre-settlement funding is a cash advance against your future settlement. Approval for this type of funding depends on the strength of your case, not your credit history.

The funding provider will review your case to estimate your odds of successful resolution and the size of your potential settlement. If your chances are good, the provider will likely approve your application. You only need to repay the advance plus any fees when you receive your settlement or award.

What Happens If You Lose the Case?

Perhaps the biggest difference between a traditional loan and pre-settlement funding is what happens if your case falls through. If you take out a conventional loan, you have to repay it no matter what. You’ll keep accruing steep fees if you can’t repay the loan on time. The lender may also seize the collateral, like your home or car.

Meanwhile, a pre-settlement advance is non-recourse funding that depends entirely on the outcome of your case. If you lose the case, you don’t need to repay. The funding provider bears all the financial risk so you can apply for the cash advance with full peace of mind.

How Applying for Legal Funding Can Help Increase Your Settlement

Insurance companies often prey upon accident victims who struggle financially. It can be tempting to accept a quick settlement offer when dealing with hefty medical bills, lost wages, and high living costs. Once you do, you lose any rights to further claims, even if you discover later that your losses far exceed the settlement.

A skilled lawyer can protect you from insurers’ bad-faith moves. Still, settlement negotiations may drag out, and you need money to cover your ongoing expenses. A pre-settlement advance can provide quick financial relief and reduce stress. It can also give you breathing room to search for other potential cash sources, including unclaimed money in the form of unpaid wages and insurance funds.

Pre-Settlement Funding Gives You Time

Your lawyer may recommend waiting until you reach maximum recovery before sending a demand letter to the insurance company. Rushing this step could make it hard to evaluate some of your losses, like future medical care you may need or your employment prospects.

You and your lawyer have more leverage when you’re not under pressure to settle. Your attorney can take the time they need to build a stronger case, gather supporting statements from medical and financial authorities, and deliver an accurate breakdown of your damages.

Pre-Settlement Funding Allows You To Pursue Every Legal Option

If the other side refuses to settle your claim, your lawyer may recommend going to court. A lawsuit can help you pursue larger compensation, but it takes much longer than a standard insurance claim.

A pre-settlement cash advance may enable you to choose the optimal legal strategy for your case rather than accept any offer because you can’t afford to wait any longer. You can make smart decisions without the pressure of mounting expenses and debts. The other side is more likely to compromise when they know you’re ready to go to trial if necessary.

What Size of Pre-Settlement Advance Can You Expect?

This depends on your specific case and the settlement you may receive. If you’re pursuing a catastrophic injury or wrongful death case, you’ll likely qualify for a bigger cash advance than someone with a minor to moderate injury. At Rockpoint Legal Funding, we quickly review your case and let you know how much pre-settlement funding we can offer.

How Can You Use Pre-Settlement Funding?

Legal funding may cover almost any expense, such as rent or mortgage, car payments, utility bills, and credit card payments.

Once your case resolves and you collect your settlement or award, you’ll repay the pre-settlement funding according to the terms you signed. You’ll also need to cover legal fees and possibly other costs, like medical liens.

Do You Qualify for Pre-Settlement Funding?

Legal funding is an option in many personal injury cases, like car accidents, slip-and-fall accidents, and animal bites. Victims of medical malpractice or employment discrimination may also apply for pre-settlement funding.

Applying for a pre-settlement advance is typically a fast, easy process. All you need to do is provide your case details, review the proposed funding agreement, and sign.

Apply for Pre-Settlement Funding Today

Are you wondering how you’ll pay the bills while you wait for your case to settle? Contact us at Rockpoint Legal Funding to explore fast, risk-free financing options.

Our clients enjoy competitive funding terms, transparent repayment plans, and capped fees. Apply now and access pre-settlement funding in as little as 24 hours.