Is Legal Funding A Loan?

Posted on August 7, 2015 by Dan Christensen

Legal funding has become a major part of the civil legal affairs over the past few decades. The newness of it has actually left many people scratching their heads and wondering what exactly the service is, which has led to misconceptions. Considering that Beacon Legal Funding is the provider of such a service, we wanted to provide you with a straightforward explanation to clear up any confusion.

What Does Legal Funding Do?

The point of legal funding is to help plaintiffs by providing them with stable financial support during a civil lawsuit. Personal injury and workers’ compensation cases can last a long time, and many injured victims can’t work while their case is unresolved. This financial stress can make it hard to pay medical bills, rent, mortgage, or even lawyers’ fees, but the settlement advances offered by legal funders like Beacon can help ease these burden.

Is Legal Funding A Type Of Loan?

The money offered by legal funders is not a loan; it is a contingent settlement advance. That means that you do not have to pay back the advance unless you win or settle your case, which can be a big risk for the funder, but not a risk for the plaintiff.

What Are The Benefits of Legal Funding?

Legal funding can defer payment like a loan, but considering that there is always the chance that there will be no repayment, it would be impossible to describe legal funding as a loan. Settlement advances also guard your credit score because they aren’t reported to credit bureaus if your case fails, and legal funders can’t interfere with your case or legal counsel.

At Beacon Legal Funding, we provide settlement advances of up to $50,000 to help plaintiffs pay living expenses while waiting for a verdict or settlement. This allows victims of personal injuries to hold out for the fairer and often larger settlement or verdict that they deserve. If you need help making ends meet while your case is in court, fill out our application and find out what we can do for you.

Beacon Legal Funding—Providing Funding Solutions



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