Pre-settlement legal funding is money being advanced to victims in personal injury cases to alleviate their quality of life (which has been impaired by the injury) up until the settlement at trial.
The term pre-settlement funding is known as "personal injury cash advance" was coined to differentiate between different types of cash advances that are available to consumers.
Pre-settlement legal funding applies only to individuals with a pending personal injury case or claim. In that respect it is very different from “pay-day” cash advances or other types of cash advances that require collateral or an acceptable credit score in order to qualify.
However, the term “pre-settlement” itself is misleading in that many companies that offer pre-settlement advances also offer post-settlement advances.
Thus the most definitive description of this type of transaction would be personal injury cash advance rather than pre-settlement funding.
Other names for this kind of financial transaction are litigation funding, accident funding, personal injury funding and non-recourse advances.
