Anonymous
Anonymous asked in Politics & GovernmentLaw & Ethics · 8 years ago

What is the meaning of Lawsuit Loan?

I've heard a lot about that. I just know that when we are involved in lawsuit we can receive cash advance, is that right?

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  • Anonymous
    8 years ago
    Favorite Answer

    Lawsuit loan is a financing process where plaintiffs are awarded with sufficient money to hold onto the conclusion of the case where plaintiffs receive their financial settlement. It's a non recourse loan, so you don't need to pay it back if you don't win the case.

    Lawsuit loan is began since many plaintiffs who get severe injured, get fired unjustly, then unable to work anymore (thus having a financial crisis) are usually being oppressed by the defendants by offering less than it's worth settlement to the plaintiffs, as exchange for dropping the case.

  • Anonymous
    7 years ago

    "Legal Funding" is actually a more appropriate term for what you're asking about. Legal funding is a form of non-recourse financing in which a third-party investor purchases a small stake in the outcome of a lawsuit. This provides a plaintiff, attorney, or law firm with a cash advance in exchange for a return on their investment through a portion of the settlement amount. Typically, legal funding is used to keep a meritorious lawsuit afloat, so that plaintiffs and lawyers can afford not to take early, low-ball settlement agreements.

  • 7 years ago

    A lawsuit loan is a transaction between a buyer (usually a plaintiff in a lawsuit) and a seller (settlement funding company). The buyer agrees to accept immediate cash in return for a portion of the proceeds of the lawsuit, if any.

  • ?
    Lv 7
    8 years ago

    If someone thinks you'll probably win, they'll advance you money in exchange for the winnings.

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