The mission of lawsuit funding companies is to provide cash now to plaintiffs who cannot afford to wait out the sometimes long and drawn out litigation process. For many litigants, lawsuit funding companies provide enough relief so they are not forced to accept a lesser settlement offer for financial reasons.
One obvious example is the severely injured plaintiff in an automobile accident whose injuries prevent him from working and being able to support himself. Although some litigants receive social benefits such as social security disability or similar programs, for many people, the amount of money received just cannot meet existing financial responsibilities.
Lawsuit funding companies are one possible solution because they can provide immediate cash to pay for any expenses. Payments for mortgage loans, car loans, utilities, food, rent, and any other expense are made possible by selling a portion of the proceeds of the lawsuit for immediate cash.

Again, the idea is that by providing financial liquidity, a plaintiff is able to meet immediate financial obligations so that the case can be pursued to its proper conclusion.
But can lawsuit funding companies meet this need in all circumstances?
Meeting The Mission with Heavy Lawsuits
The financial needs of litigants are pretty similar. Each of us, including plaintiffs, face financial obligations each and every month. Living expenses, car payments, food, shelter and the like are all routine financial transactions for citizens. For personal injury plaintiffs, meeting these needs can sometimes be a challenge. Lawsuit funding companies try to alleviate some of this financial pressure.
The type of lawsuit however may change the ability of lawsuit funding companies to meet their objectives and help their clients.
For example, funding catastrophic injuries are rarely a problem. This is true because enough money can be safely advanced to these clients because of the lawsuit’s high potential settlement value. A client with a million dollar lawsuit, who receives $100,000 in settlement funding, will most likely be able to meet basic expenses for a good while.
Missing the Mark with Smaller Cases?
Funding a soft tissue case or a lawsuit with significantly less severe injuries poses a subtle twist in the analysis.
Although settlement loans on personal injury lawsuits involving soft tissue injuries do provide financial relief, the condition is temporary. That is, it is unlikely any soft tissue lawsuit will yield a settlement value that would permanently change the litigant’s life. The vast majority of these cases are settled for less than $15,000 which means the client at best will NET $10,000 for pain and suffering.
The point is that obtaining a small lawsuit cash advance will not allow the client to hang on until a more fair settlement is obtained. By their very nature, soft tissue injuries are less severe. Those suffering from whiplash type injuries often still go to work and maintain their regular standard of living.
In these instances, lawsuit funding companies fail to live up to their mission – allowing plaintiffs the financial wherewithal to endure the litigation process. Instead, funding of smaller amounts simply offer a temporary fix for plaintiffs’ financial woes. Expenses are still expenses however, and perhaps a little financial relief is better than no financial relief at all.
Freedom of Choice
Ultimately, it is up to the consumer (litigant) to allow lawsuit funding companies to provide this service. Plaintiffs should consider themselves fortunate to have the OPTION to secure financial relief through this medium. Lawsuit funding companies should also be grateful a free market system allows for creative solutions to existing needs in the marketplace.
Thank you for your interest in the settlement loan business.