Frequently Asked Questions (FAQs) Directory

Overview of Non-Recourse Legal Funding

Non-recourse legal funding, also known as pre-settlement funding and sometimes referred to as a lawsuit loan, is a risk-free cash advance available to injured plaintiffs while they wait for their case to resolve.

This guide explains how it works, how it differs from a traditional loan, what types of cases qualify, and why Express Legal Funding is a trusted provider offering fast, transparent support with no repayment required if you lose your case.

How Non-Recourse Legal Funding Works

What is non-recourse legal funding for plaintiffs?

Non-recourse legal funding is a cash advance offered to plaintiffs in civil lawsuits, based on the anticipated value of their future settlement or judgment. It’s considered “non-recourse” because you only repay the funding if your case is successful, either through a settlement or court award. If you lose, you owe nothing.

How does non-recourse funding differ from recourse loans?

Non-recourse legal funding is fundamentally different from traditional (recourse) loans because it carries no personal repayment obligation. If you lose your case, you’re not required to repay the advance. In contrast, recourse loans hold you personally liable, meaning the lender can pursue your income, credit, or assets to collect the debt, regardless of the outcome of your case.

Why is it called 'non-recourse'?

The term “non-recourse” means the funding company cannot pursue you personally for repayment if your case is unsuccessful. Their only source of repayment is your future settlement or court award. If there’s no recovery, you owe nothing.

Is non-recourse legal funding considered a loan?

No. Legal funding is typically classified as a non-loan financial product or legal advance. This distinction means it isn’t subject to the same laws and interest rate caps that govern loans.

Key Terms in a Non-Recourse Funding Agreement

What are the legal terms involved in a non-recourse legal funding agreement?

A non-recourse legal funding agreement sets forth the official terms under which a plaintiff receives an advance on their expected settlement. The contract is designed to ensure transparency and legal clarity for all parties involved. Key provisions typically include:

• Funding amount: The specific dollar amount being advanced to you based on your case’s estimated value.
• Repayment terms: Clear instructions on how and when repayment occurs—usually only if and when you receive a monetary settlement or judgment.
• Fees and charges: A detailed breakdown of applicable funding rates, capped fees, and how charges accrue over time (e.g., fixed or compounding).
• No-repayment clause: A critical provision confirming that you owe nothing if your case is unsuccessful—this is what makes the funding non-recourse.
• Purchase Agreement: The core legal contract that outlines the sale of a portion of your future recovery to the funding company in exchange for the advance.
• Consumer Disclosure: A document summarizing the funding terms in plain language, including the total anticipated repayment amount and effective rate, designed to ensure you understand the cost of funding.
• Payment Instructions: Specifies how you wish to receive your funds (e.g., via ACH transfer, wire, e-check, or other method).
• Notice of Purchase and Assignment: A clause stating that the funding company has purchased a portion of your potential recovery, and that this assignment is acknowledged by you and your attorney.
• Irrevocable Letter of Direction: An authorization directing your attorney to repay the funding company directly from your settlement or judgment proceeds before disbursing any remaining funds to you.
• Attorney Acknowledgment: A signed statement from your attorney confirming their cooperation, agreement with the terms, and responsibility for handling repayment per the contract.

These components work together to ensure legal clarity, consumer protection, and ethical handling of funds throughout your case.

Learn more about the different types of legal funding in our guide: What Are the Types of Legal Funding?

Do I have to repay my non-recourse legal funding if I lose my case?

No. That’s the key benefit of non-recourse funding. You are not obligated to repay the advance if you do not win or settle the case.

Who Qualifies and How to Apply for Non-Recourse Legal Funding

Who qualifies for non-recourse legal funding?

To qualify for non-recourse legal funding, you must have a strong personal injury or civil lawsuit, be represented by a contingency fee attorney, and have a lawyer who is willing to cooperate with the funding company by providing case documents for review.

What types of cases are eligible for non-recourse legal funding?

Common case types that qualify for non-recourse legal funding include:

• Car accidents
• Slip and fall injuries
• Medical malpractice cases
• Wrongful death
• Workplace injuries
• Product liability lawsuits

Do I need an attorney to apply for legal funding?

You can apply for legal funding without an attorney, but you must have legal representation to be approved. Funding companies require your attorney’s cooperation to review your case and finalize the funding agreement.

Explore the importance of having a lawyer for pre-settlement funding further in our guide: Can I Get Pre-Settlement Funding Without Attorney Consent?

Can I be denied funding? If so, why?

Yes, legal funding can be denied for several reasons. Common factors include weak or disputed liability, a low expected settlement value, an attorney who is unwilling to cooperate, or excessive existing funding from other providers that limits remaining recovery.

Non-Recourse Funding Process and Repayment

How does the non-recourse legal funding process work?

The non-recourse legal funding process is fast and straightforward:

1. Submit your application: Apply online or over the phone with basic case details.
2. Attorney cooperation: Your lawyer provides case documents and confirms representation.
3. Case evaluation: The funding company reviews your claim’s strength and estimated value.
4. Approval and agreement: If approved, you’ll receive a funding agreement to sign.
5. Receive your funds: Once finalized, funds are typically disbursed within 24 hours, often the same day.

How much money can I receive through legal funding?

The amount you can receive through legal funding depends on the estimated value of your case. Advances typically range from $500 to $500,000. Funding companies assess your projected settlement by evaluating damages, including medical expenses, lost wages, and pain and suffering, along with attorney fees, liens, and other case-related deductions.

Relevant guide: How Much Pre-Settlement Funding Can I Get on My Case?

When do I get my funds after approval?

Most clients receive their funds within 24 hours of approval—often the same day—through a secure ACH transfer, direct deposit, or e-check, depending on the method selected.

What happens if my case takes longer than expected?

If your case takes longer than expected, there’s no pressure to repay early—non-recourse legal funding is only repaid after your case settles. Your agreement remains valid for the duration of your lawsuit, though fees or charges may continue to accrue over time based on the terms outlined in your contract.

Are there any upfront costs or fees?

No, reputable legal funding companies do not charge any upfront costs. There are no application fees, hidden charges, or credit checks required. Any fees associated with the funding are only repaid after your case settles or results in a successful judgment.

How are fees calculated on non-recourse legal funding?

Fees on non-recourse legal funding are usually calculated as either a fixed rate or a monthly compounding rate applied to the funded amount. The total cost depends on how long your case takes to resolve, so it's important to ask whether the fees are based on a simple interest model or compound over time.

Do interest rates apply to my funding amount?

Yes, though they’re often not classified as traditional “interest” under state laws. Instead, these charges are typically labeled as funding fees or usage fees, which can vary significantly between providers. Rates vary widely, so review the terms carefully and choose a company that offers clear, transparent pricing.

Non-Recourse Legal Funding Benefits and Drawbacks

What are the benefits of choosing non-recourse funding?

Non-recourse legal funding provides several important advantages for plaintiffs during a pending lawsuit:

• No repayment if you lose: You owe nothing if your case doesn’t result in a settlement or award.
• Fast access to cash: Funds are often disbursed within 24 hours of approval.
• Covers essential living expenses: Helps you pay for rent, groceries, medical bills, and utilities.
• No credit impact: No credit checks are required, so it shouldn’t affect your credit score.
• Supports a stronger case outcome: Gives your attorney more time to negotiate a fair and full settlement without financial pressure.

Are there risks involved for plaintiffs?

Non-recourse legal funding isn’t considered risky because you owe nothing if you lose your case. However, the advance and any applicable fees are deducted from your final settlement, which can reduce your net payout. Since you’re receiving part of your future settlement upfront, it’s important to borrow only what you need and fully understand the terms.

How does non-recourse funding help during long legal battles?

Non-recourse funding provides crucial financial support during prolonged lawsuits, helping plaintiffs pay for essentials like rent, food, and medical bills. By easing financial stress for plaintiffs, it prevents the need to settle early for less and gives your attorney the time and leverage to pursue the full value of your claim.

Legal Rights and Protections

Is non-recourse funding regulated by law?

Regulation of non-recourse legal funding varies by state. Some states have specific laws or consumer protection regulations that govern the industry, while others do not regulate it at all. Because oversight differs, it’s essential to read your contract thoroughly and ask questions to ensure you understand the terms.

Can a legal funding company interfere in my case?

No, legal funding companies are not allowed to interfere with your case. They have no control over legal decisions, settlement negotiations, or your attorney’s strategy—those remain strictly between you and your lawyer.

What rights do I have under a non-recourse funding agreement?

When you enter into a non-recourse funding agreement, you’re entitled to several important rights designed to protect your interests:

• Right to clear disclosure of terms: You have the right to receive a transparent explanation of all fees, rates, and repayment conditions before signing.
• Right to cancel within a grace period: In many states, you can cancel the agreement without penalty within a specified time frame.
• Right to attorney-client confidentiality: Your legal funding arrangement does not waive your attorney-client privilege and, in some states, is specifically protected from discovery.

What should I look for in a legal funding company?

When choosing a legal funding provider, look for a company that prioritizes fairness, speed, and transparency. Key qualities include:

• Transparent terms: Clear, easy-to-understand contracts with no confusing language.
• Capped fees: Limits on how much the funding cost can grow over time.
• No hidden charges: All fees should be disclosed upfront—no surprises later.
• Fast turnaround: Quick application processing and same-day or next-day funding options.
• Excellent customer support: Responsive, knowledgeable staff to guide you through the process.
• Direct funding (not via brokers): Work with companies that fund cases directly to avoid extra markups or third-party delays.

Alternatives to Non-Recourse Legal Funding

If you're not ready to pursue legal funding or want to explore other financial options, here are some common alternatives to help cover expenses during a lawsuit:

• Personal savings: Using your own funds can help you avoid fees or repayment obligations.
• Friends or family: Borrowing from trusted individuals may provide flexible, interest-free support.
• Personal loans or credit cards: These options may be accessible but often involve interest, credit checks, and personal liability.
• Disability benefits or insurance payouts: If you're eligible, these can provide steady income during recovery.
• Crowdfunding platforms: Online fundraising through platforms like GoFundMe can help gather community support for urgent needs.

Relevant guide: 15 Alternatives to Lawsuit Loans

Is non-recourse legal funding the right choice for me?

If you're struggling financially while waiting for your personal injury or civil case to settle, non-recourse legal funding can be a smart solution. It provides fast, risk-free support with no repayment if you lose—making it a helpful tool when used responsibly and with a clear understanding of the terms.

Express Legal Funding sets itself apart by providing honest, affordable, and risk-free non-recourse legal funding designed to protect your recovery. Here's what makes us different:

• Low, affordable rates: Our pricing is competitive and structured to help you keep more of your settlement.
• Capped origination fee: We limit the upfront cost to ensure your funding remains fair and manageable.
• Capped funding rate: Your rate won’t spiral over time—we set clear maximums to protect your payout.
• Direct funding—not through brokers: We fund your case directly, eliminating broker markups and delays.
• 100% risk-free guarantee: You owe nothing if your case doesn’t settle or win—no hidden conditions.
• No hidden fees: All terms are clearly disclosed upfront, with no surprise charges.

At Express Legal Funding, we prioritize transparency and fairness, so you get the financial support you need without compromising your future settlement.

See why Express Legal Funding ranked number as the best legal funding company in 2025: 10 Best Legal Funding Companies in 2025

Final Thoughts on Non-Recourse Legal Funding

Non-recourse legal funding can be a valuable lifeline for plaintiffs facing financial hardship during a pending lawsuit. It offers risk-free access to cash when you need it most, without adding debt or requiring repayment if your case is unsuccessful.

As with any financial decision, it’s important to understand the terms, borrow only what you need, and choose a transparent, reputable funding company. When used wisely, non-recourse funding can help you stay afloat and give your attorney the time needed to pursue the fair settlement you deserve.

Apply Now for Non-Recourse Legal Funding

Are you waiting on a personal injury or civil lawsuit to settle and need fast financial support? Express Legal Funding can help you get the cash you need, risk-free and with no upfront costs.

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Simply complete the secure form below. Our team will review your application and contact your attorney for a quick case evaluation.