What is a Lawsuit Advance?
A lawsuit advance is a cash amount one may receive on the pending amount of a lawsuit. Cash advances are made by a specific company who purchases the rights to that cash if and when the lawsuit settles. In the event that the lawsuit is not successful, the lawsuit advance company cannot collect against the borrower, though occasionally some fees are assessed. This type of transaction is called a non-recourse transaction, as the purchaser (the advancer of the loan) has recourse only to the proceeds of the suit. The lawsuit advance industry got its start as organized businesses in the late 1980s. Prior to that, one might informally borrow funds from a friend, a bank, or other interested parties to tide them over until he or she successfully received funds owed as a result of a lawsuit. Today, the lawsuit advance industry is a competitive business. Interest rates depend upon the type of case, the viability of the case, and the marketable rate of companies providing advances. Reputable laws
