There is often confusion when it comes to understanding pre-settlement funding and what it entails. Some often mistake it for a loan, but this is not the case. Pre settlement funding usually comes in the form of non-recourse cash advances, and is generally provided to the injured party in return for the promise to pay the advance after the lawsuit settles.
For example, if you are involved in a traffic accident where the other party is obviously fully at fault, you would likely be a great candidate for pre-settlement funding. Since the lengthy process of accidents, claims and lawsuits can sometimes take a great deal of time, having cash on hand is important. Whether you need cash for medical bills, daily survival or other needs, it is definitely something to consider when facing this type of situation.
Based on the information provided by the customer or their lawyer, the cash advance company then creates an estimate based on what the likely settlement value will be, and offers the cash advance based on that specific estimate. Most of these advances are generally offered as non-recourse funding, which means that the injured party has no obligation to repay the advance if the lawsuit is lost.
Litigation can often take quite a long time, sometimes years and years; it often becomes necessary to seek out a cash advance of sorts. This is especially important if the party is injured, since this could mean lost time from work. When you are dealing with an injury and unable to come up with the financial means for treating the injury while litigation takes place, then take a look into pre-settlement funding to give yourself a better chance.