Settlement funding refers to financial assistance provided to plaintiffs who are awaiting the resolution of their lawsuits. This funding is crucial for individuals who may face financial difficulties during prolonged legal proceedings. It allows them to cover immediate expenses such as medical bills and living costs while waiting for their case to settle. This article focuses on pre-settlement and post-settlement funding, outlining what to consider when selecting a settlement funding company.

What is Settlement Funding?

Settlement funding is essentially a cash advance against a future lawsuit settlement. Plaintiffs can receive money upfront, which they will repay once their case is resolved favorably. Eligibility typically requires that the plaintiff has a pending lawsuit and legal representation. Common cases eligible for settlement funding include personal injury claims,employment and habitability claims, and other civil lawsuits where a monetary settlement is expected.

What Settlement Funders Do

Settlement funders evaluate pending lawsuits and provide cash advances to plaintiffs based on the projected settlement amount. This funding is typically non-recourse, meaning that if the plaintiff does not win their case, they are not obligated to repay the advance. The funding can be used for various expenses, including medical bills, living costs, and other financial obligations that may arise while waiting for a case to be settled.

What is Pre-Settlement Funding?

Pre-settlement funding provides financial relief before a case is resolved, helping plaintiffs manage immediate expenses. This type of funding alleviates financial pressure, allowing individuals to pursue fair compensation without feeling rushed to settle for less than their case is worth. It enables plaintiffs to maintain their quality of life while waiting for their legal matters to conclude.

What is Post-Settlement Funding?

Post-settlement funding occurs after a settlement has been reached but before the funds are disbursed. This option helps plaintiffs manage unexpected financial delays that can occur during the processing of settlement payments. It serves as a bridge for individuals needing immediate access to funds despite the settlement being finalized.

Pre-Settlement vs. Post-Settlement Funding: Key Differences

FeaturePre-Settlement FundingPost-Settlement Funding
EligibilityPending lawsuits with strong casesSettlements reached but not yet disbursed
PurposeCovers immediate expensesManages delays in receiving settlement funds
Typical Funding AmountsVaries based on case value (often up to 10% of projected settlement)Typically based on the total settlement amount

Considerations When Choosing a Settlement Funder

When selecting a settlement funding provider, plaintiffs should consider several factors:

The Pros and Cons of Settlement Funding

Pros

Cons

Final Thoughts 

Understanding the distinctions between pre-settlement and post-settlement funding is essential for plaintiffs navigating their legal journeys. Careful consideration of options and thorough research into reputable lawsuit funding companies can lead to better financial outcomes during challenging times. Plaintiffs are encouraged to consult with legal professionals and explore reliable funding options that align with their needs.

Who is Fund Capital America?

Since 2006, Fund Capital America (FCA) has been a trusted leader in pre-settlement funding, providing cash advance loans to plaintiffs in personal injury and accident cases. Over the years, FCA has proudly served thousands of law firms and tens of thousands of clients, helping them navigate the financial challenges of litigation. While our core service is pre-settlement funding, we also offer a comprehensive range of services to support law firms and their clients from the beginning of the case to the final settlement check distribution.

Fund Capital America’s Services

In addition to lawsuit cash advance, FCA provides a broad array of services designed to alleviate the financial and administrative burdens on injury victims, law firms, and medical professionals. Our services include:

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