5 Common Misconceptions About Lawsuit Funding
Think you need good credit or a massive case to qualify? Think again. We debunk the biggest myths about pre-settlement funding.
Lawsuit funding (also known as pre-settlement funding) is an invaluable resource for plaintiffs struggling financially while they wait for their case to resolve. However, the industry is often misunderstood.
There are many myths surrounding legal funding that prevent people from getting the help they need. Today, we are clearing up five of the most common misconceptions.
1. Myth: It’s a Loan
Fact: It’s a Non-Recourse Advance
This is the most common confusion. While it feels like a loan because you are receiving money now to pay back later, the legal structure is completely different. A loan must be repaid no matter what. Lawsuit funding is a non-recourse cash advance. This means repayment is contingent entirely on the outcome of your case. If you lose, you owe nothing. Zero risk.
2. Myth: You Need Good Credit to Qualify
Fact: Your Credit Score Doesn't Matter
Traditional banks look at your credit score and employment history. We don't. At Flash Legal Funding, we are investing in the strength of your lawsuit, not your personal financial history. Whether you have perfect credit or no credit, your eligibility depends solely on the merits of your case and the likelihood of a settlement.
3. Myth: Lawsuit Funding is "Too Expensive"
Fact: It Can Actually Help You Win More
While funding companies do charge fees, consider the alternative. Without funding, financial pressure might force you to accept the first low-ball offer the insurance company throws at you. Funding gives you the "holding power" to reject low offers and let your attorney fight for the maximum settlement. Often, the increase in your final settlement amount outweighs the cost of the funding.
4. Myth: It’s Only for Legal Expenses
Fact: Use the Money for Whatever You Need
Some people assume this money must go toward attorney fees. That is incorrect (your attorney usually works on contingency anyway). This money is for you. You can use it to pay rent, cover medical bills, buy groceries, fix your car, or handle any other living expense. There are no restrictions on how you spend your advance.
5. Myth: It’s Only for Massive Class-Action Cases
Fact: We Fund Cases of All Sizes
You don't need to be involved in a multi-million dollar class-action suit to qualify. Flash Legal Funding helps clients with all types of personal injury claims, including car accidents, slip and falls, and workplace injuries. No case is too small if you have a valid claim and a need for help.
Conclusion
By dispelling these myths, we hope more plaintiffs feel empowered to use this financial tool. Lawsuit funding is a safe, regulated way to keep your life on track while your attorney does their job.
If you have more questions or want to see if you qualify, don't hesitate to reach out to us at Flash Legal Funding.