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Are There Pre-Settlement Lawsuit Loans with Low Interest?

Are There Pre-Settlement Lawsuit Loans with Low Interest?

Are There Pre-Settlement Lawsuit Loans with Low Interest?

Victims of personal injury cases short in cash can only be a few keystrokes away from an easy, painless solution to this problem as top-rated lawsuit funding companies feature: “will get you money right now!”

A pre-settlement lawsuit loan is valued as a “no-risk agreement – no recovery means no repayment” type of loan in the form of cash advances, which personal injury victims can use to cover personal expenses.  The cash advance or loan is later repaid from the settlement proceeds if the case wins and will not need to be paid back if the case is lost.

How to Look For Top Rated Lawsuit Funding Companies

Lawsuit loans have many benefits for injured accident victims and personal injury victims providing financial assistance to help them stay afloat while they recover, that’s how settlement lawsuit loans work.  However, these types of loans have been criticized for excessive fees and high-interest rates.  Consider this guide when you scout for the best lawsuit funding companies:

  • Make sure the company operates in your state.  They may not be located in your state, but they should be licensed to do business in your location. 
  • Compare the company’s offers with other lawsuit loan companies.  Since this type of loan is not regulated in most states, companies can charge different interest rates and fees and can offer different percentages of your predicted settlement amount.
  • The company should be completely transparent in laying out and letting you clearly understand how much interest they will charge you every month plus other fees before you receive your settlement funds.  These amounts will impact how much money you could potentially receive when your case gets settled.

How Many Pre-Settlement Loans Can You Get?

There is no limit to the number of pre-settlement lawsuit loans you can get.  A number of plaintiffs of lawsuit loans take out a second or third loan in their case.  

This is because the duration of a lawsuit is unpredictable and when it takes far longer to settle, you might run out of cash from the first pre-settlement funding you got.

You can be eligible for another loan considering the following:

  • You should be honest with the pre-settlement funding company about the existing loan
  • All the factors related to your case including the existence of a prior pre-settlement advance
  • You took out less than you were offered as a ‘maximum’ loan the first time

Low-Interest Pre-Settlement Loans

Lawsuit funding companies’ interest rates vary from company to company.  If you are considering a pre-settlement lawsuit loan, you are probably interested in finding the lowest interest rate available.

This loan usually carries a higher interest rate because of the great risk associated with lending the money so the interest rates for lawsuit loans can be anywhere between 1-5%.  Most lending companies consider several factors in determining your interest rate including:

  • Strength of your case
  • Where you filed the case
  • The number of damages claimed

The best lawsuit loan companies will take all the facts of your case into consideration before they decide on an interest rate on your loan.  The interest rate should directly correlate to the risk involved in funding your case.

How to Get the Lowest Cost Pre-Settlement Funding

Make sure that the lawsuit company you are dealing with listens to your concerns, sincerely cares for your well-being, and is transparent with their fees and rates.  Follow these tips to help you determine which company offers the best reasonable rates for your pre-settlement lawsuit loan:

  1.  Ask the company specifically about their rates.
  2. If the company’s rates sound too good to be true, it probably is.
  3. Spot a deceitful lender.  If you are offered a pre-settlement rate less than 2.5%, respectfully ask to get that quoted rate in writing.  If they are hesitant about making a false claim in writing, that is already a red flag.
  4. The rate in the legal funding agreement should match the rate you were promised at the very beginning.


The best way to get the lowest reasonable interest rate for your pre-settlement lawsuit loan is to call your prospective lawsuit loan company.  Every company bases its assessment of the details of your lawsuit to provide you with your actual rate.  A lower interest rate may even be reconsidered when the company has spoken with your attorney.