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Can I Borrow Money for My Lawsuit?

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It is common for people involved in a lawsuit to need money. One possible solution for them is to take out a lawsuit loan to cover their financial needs until their case is settled or they win a judgment. There are times when plaintiffs deal with insufficient income to cover all of their expenses. When they borrow money in this way, it is referred to as a lawsuit loan, settlement funding, or a Nevada car accident loan.

Lawsuit Loan

A plaintiff soon realizes that filing a lawsuit is time-consuming, as well as an expensive endeavor. Many plaintiffs are forced to deal with injuries that have resulted in losing income and experiencing unexpected expenses such as significant medical bills and more. Their financial situation can become serious before they win their case or receive a judgment.

This is when most plaintiffs consider getting a lawsuit loan. It is used to help with their financial challenges during the time they wait for a conclusion to their lawsuit. In this situation, a funding company purchases the right to all or a portion of a plaintiff’s lawsuit proceeds. In exchange, they provide a cash advance a plaintiff can get while their lawsuit is pending.


A lawsuit loan can provide financial relief for a plaintiff who is struggling to pay their car loan payments, medical bills, mortgage payment, and other living expenses. It can also provide the time necessary to negotiate a good settlement.

This is a way a plaintiff can have enough time to calmly consider if a settlement offer is sufficient. Plaintiffs don’t want to prolong their litigation. They do want to try and obtain a fair result.

If a lawsuit loan can alleviate financial stress, a plaintiff and their attorney can take more time to successfully negotiate with the defendant. If a defendant refuses to provide a fair settlement, a lawsuit loan could provide a plaintiff with what they need to survive financially when going to trial.


When a plaintiff pays a lender out of the proceeds of their settlement or judgment, they pay back the principal amount they borrowed as well as a funding fee or interest payments. This could end up being double or triple what the plaintiff borrowed from the lender.

A personal injury case may take months or even years to reach a conclusion. Many lawsuit loans can have interest rates of up to 60 percent a year. This is comparable to a payday loan. The interest is usually compounded monthly. It is common for a plaintiff to pay back an amount that is more than what they borrowed.

Not All Cases Qualify

Lending companies know they are taking a significant risk by offering a lawsuit loan. They will only provide a lawsuit loan if it is believed that a plaintiff will win their case.

If the plaintiff loses their case, they may not have to pay the loan back. If a plaintiff wins less than the lending company anticipated, they may not have to pay back the entire amount. This is the reason a lender will want to only fund a case that is likely to provide a good payout. It is also why lawsuit lenders are particular about the cases they accept. It is common for a plaintiff to apply to five or more lending companies before finding one interested in their case.

There are very few restrictions covering how much a lending company can charge for a car accident loan. There are even fewer requirements when it comes to disclosing interest rates and other terms. This makes it a challenge to find and compare the rates of different companies. It is common for the vocabulary used to promote this lending product to be different from one company to another. Some will refer to it as a lawsuit loan and others a lawsuit advance.