Pre-settlement funding and personal injury lawsuit loans are a way to help injury victims with an open lawsuit to receive money now. The lawsuit loan is no risk to the borrower and is similar to a cash advance, with the collateral being your lawsuit settlement. There are several state regulations for these loans.
Even with state regulations, you should stay aware of the offers and practices of the loan companies, which you can review via our FAQs. Silver Dollar Financial follows state regulations for pre–settlement funding loans in all states where we offer them. Some states are exempt from pre-settlement funding loans.
Traditional Loans
While you wait for a case resolution, you will have many financial struggles, and you will also have many options for getting money to help ease your financial burden.
Traditional personal loans require applicants to provide information about their credit score, financial situation, and employment status. These companies can deny your claim based on your credit score, which was likely impacted by your injury.
Personal injuries often result in people being unable to work and getting behind on their bills. When you apply for a loan, you seek a reprieve. However, traditional loan companies want the least risk.
However, lawsuit loans from Silver Dollar Financial are different. We do not require proof of employment, income, or complete a credit check. You can get a cash advance in 24 hours, and we guarantee that you will owe nothing if you do not win your case.
Click to contact the Silver Dollar Financial Team today or Call +1(844)871-0628
Lawsuit Funding Regulations
State regulations and the agencies regulating lawsuit loans aim to protect consumers from higher rates and shady practices. State regulations can impact the accessibility of financial resources for clients. Some states that prevent plaintiffs from legal funding include:
- Arizona
- Arkansas
- Colorado
- Kentucky
- Kansas
- Maryland
- New Mexico
- Nevada
- Tennessee
- Vermont
- West Virginia
Some state regulations allow for certain lawsuit loans and exclude others. The list can change as regulations evolve. Check with Silver Dollar Financial underwriters to see if your state allows you to get legal funding for your injury case, and if you have any questions, we are here for you.
Pre-Settlement Funding State Availability
Pre-settlement loans are not offered in every state because of risk factors. Sometimes, they are strictly prohibited, which is another reason these loans are not provided nationwide. Based on state laws, certain states treat lawsuit loans as traditional loans and require lawsuit loan companies to charge the same rates as conventional loan companies.
Traditional loans are recourse lending, which is a secured debt. This means that you are guaranteed that you will pay the loan back no matter what. Pre-settlement loans are non-recourse, and therefore, they work on collateral. The collateral is your final settlement.
Legal loan companies will only recover payment if you win your case. Non-recourse debts do not require credit scores, employment verification, or other financial information. When states require non-recourse and recourse debts to be treated the same, it goes against how lawsuit loan companies operate.
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The Legality of Lawsuit Loans in the U.S.
Unfortunately, Silver Dollar Financial does not offer pre–settlement legal funding due to state regulations in all 50 states. This may change in the future. Currently, the states where we do not offer funding include:
- Arkansas
- Connecticut
- Kansas
- Kentucky
- Maryland
- Minnesota
- North Dakota
- Vermont
- West Virginia
Click on the states below to learn more about which state laws, if any, could have an impact on your pre-settlement funding loans:
| Alabama | Maine | Ohio |
| Alaska | Massachusetts | Oklahoma |
| Arizona | Michigan | Oregon |
| California | Mississippi | Pennsylvania |
| Colorado | Missouri | Rhode Island |
| Delaware | Montana | South Carolina |
| Florida | Nebraska | South Dakota |
| Georgia | Nevada | Tennessee |
| Hawaii | New Hampshire | Texas |
| Idaho | New Jersey | Utah |
| Illinois | New Mexico | Virginia |
| Indiana | New York | Washington |
| Iowa | Wisconsin | Wyoming |
| Louisiana | North Carolina |
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State Laws Vary Surrounding Pre-Settlement Funding
Every state has different laws regarding how they approach pre-settlement loans and legal funding. In our experience, there are a couple of different ways states handle lawsuit loans. They could:
- Allow funding companies to provide financing
- Ban pre-settlement loans entirely
- Have introduced legislation to regulate legal funding
Silver Dollar Financial may offer pre-settlement loans in the following states. Below, you will find more information about how each state’s approach to pre-settlement legal funding. If you have more state-specific questions or concerns, do not hesitate to contact our loan specialists for more information.
Alabama
There is currently no legislation that addresses lawsuit loads in Alabama. However, the validity of legal funding has been called into question on a case-by-case basis. We do currently offer legal funding in Alabama.
Alaska
No law in Alaska discusses pre-settlement loans. Other related doctrines have been recognized but never applied to lawsuit loans. For this reason, we currently offer legal funding in Alaska.
Arizona
Lawsuit loans are legal in Arizona. Although several courts have invalidated certain contracts, no laws prohibit pre-settlement legal funding. We currently offer legal funding in Arizona.
California
Californians have embraced lawsuit loans. There are no regulations prohibiting pre-settlement loans or litigation funding. Since contracts are strictly enforced, we do provide legal funding in California.
Colorado
Litigation financing is strictly regulated in Colorado. There is an interest rate cap on lawsuit loans with a minimum loan amount of $75,000, according to Colorado House Bill 23-1162. Since Silver Dollar Financial can offer up to $100,000 in cash advances, we do offer legal funding in Colorado.
Delaware
Delaware law requires lawsuit loan companies to remain impartial. They can in no way interfere with the outcome of a case. We do offer lawsuit loans in Delaware.
Florida
Florida courts generally uphold lawsuit loan contracts. However, this could be called into question if the lawsuit loan company attempts to interfere in the outcome of the case. Silver Dollar Financial does offer lawsuit loans in Florida.
Georgia
Georgia welcomes lawsuit loans as a way for victims to get the financial support they need when they need it most. Since Georgia does not consider litigation funding a loan, lending laws do not apply. We do provide legal funding in the state of Georgia.
Hawaii
There are no laws that prohibit legal funding in Hawaii. It is a common practice across the state. We do offer lawsuit loans in Hawaii.
Idaho
Idaho does not prohibit legal funding. State courts have enforced lawsuit loan contracts. We do offer legal funding in Idaho.
Illinois
Illinois regulates lawsuit loans. Companies must be licensed to offer lawsuit loans in Illinois according to the Consumer Legal Funding Act. We do offer legal funding, though interest rates are capped at 36%, and applicants can only receive up to $40,000.
Indiana
There are restrictions on how much interest lenders can charge in Indiana according to Indiana’s Uniform Consumer Credit Code. With that being said, litigation funding is legal in Indiana. We currently offer pre-settlement funding in this state.
Iowa
Iowa does not have any laws in place that prohibit lawsuit loans. However, there have been some cases where contracts were invalidated. We do offer legal funding in Iowa.
Louisiana
Louisiana prohibits court officers from being involved in the assignment or sale of legal claims. However, lawsuit loans are still legal. We do provide pre-settlement loans in Louisiana.
Maine
Maine does have restrictions on lawsuit loan agreements. There is no rate cap on interest. We do offer legal funding in Maine.
Massachusetts
There are no laws restricting legal funding in Massachusetts. In fact, it is one of the most lawsuit-loan-friendly states across the country. We do provide lawsuit loans in Massachusetts.
Michigan
Michigan Courts have ruled legal funding contracts invalid. However, there are no laws prohibiting legal funding. We do offer lawsuit loans in Michigan.
Mississippi
In Mississippi, lenders must remain as neutral third parties. Failure to do so could invalidate the contract. We do offer legal funding in Mississippi.
Missouri
Missouri courts have not been favorable to pre-settlement legal funding. However, there are no laws against it. For this reason, we do offer pre-settlement loans in Missouri.
Montana
Litigation funding is legal in Montana as long as the lender is not a lawyer. Contracts are regularly validated in state courts. We do offer pre-settlement loans in Montana.
Nebraska
Lawsuit loan providers must register as such in Nebraska according to the Nebraska Department of Banking and Finances. However, lawsuit loans are legal. We do provide pre-settlement funding in Nebraska.
Nevada
In Nevada, lawsuit loan companies must register with the state under NRS Chapter 604C – Consumer Litigation Funding. There is an interest rate cap of 40%. We do offer lawsuit loans in Nevada.
New Hampshire
New Hampshire courts have supported lawsuit loans. However, the New Hampshire Bar Association prohibits lawyers from lending money to their clients. We do offer legal funding in New Hampshire.
New Jersey
New Jersey expressly allows lawsuit loans. There are no laws regulating legal funding. We do offer litigation funding in New Jersey.
New Mexico
New Mexico courts do not currently regulate lawsuit loans, and they have invalidated certain contracts. However, we do offer legal funding in New Mexico.
New York
Lawsuit loans are legal in New York and are not regulated. Court systems have upheld these contracts. We do provide legal funding in New York.
North Carolina
North Carolina regulates its legal funding, though it is not prohibited. There are annual percentage rate caps under the Consumers in Crisis Protection Act. We do offer legal funding in North Carolina.
Ohio
Ohio allows lawsuit loans, though it is regulated. Lenders are allowed a five-day window to cancel their contracts without penalty under Ohio Revised Code § 1349.55(2). We do offer lawsuit loans in Ohio.
Oklahoma
Oklahoma regulates lawsuit loans. Companies must be registered with the state and make disclosures to clients before entering a legally binding agreement according to 14A O.S. 3-801-817. We do offer litigation funding in Oklahoma.
Oregon
Pre-settlement loans are not regulated in Oregon. Courts have upheld these contracts. We do provide lawsuit loans in Oregon.
Pennsylvania
Based on court precedence, lawsuit loans are legal in the Commonwealth of Pennsylvania. However, communications between third-party lenders and a plaintiff are protected by attorney-client privilege. We do offer legal funding in Pennsylvania.
Rhode Island
Rhode Island does not prohibit pre-settlement legal funding. There are no laws limiting or blocking them. We do offer legal funding in Rhode Island.
South Carolina
South Carolina allows lawsuit loans. However, there are strict restrictions, including a rate cap on advances up to $90,000 under the Consumer Protection Code. We do offer settlement loans in South Carolina.
South Dakota
South Dakota does not prohibit pre-settlement loans. However, in some cases, South Dakota courts determined some contracts invalid. We do offer pre-settlement loans in South Dakota.
Tennessee
There is a cap on interest rates in Tennessee according to the Tennessee Litigation Financing Consumer Protection Act. Lenders are also required to be registered. We do offer pre-settlement loans in Tennessee.
Texas
There is no legislation prohibiting lawsuit loans. The discussions between clients and lawsuit loan lenders are protected by attorney-client privilege. We do offer pre-settlement loans in Texas.
Utah
Utah allows settlement loans. However, lenders must give clients the right to cancel, require disclosures, and register with the state under the Litigation Funding Practices Act. We do offer legal funding in Utah.
Virginia
Virginia permits lawsuit loans. When challenged, agreements are typically challenged in court. We offer legal funding in Virginia.
Washington
There are no laws against lawsuit loans in Washington state. Courts do not typically overturn contracts. We do offer lawsuit loans in Washington.
Wisconsin
Wisconsin does allow pre-settlement legal funding. However, sometimes, contracts can be invalidated. We do offer legal funding in Wisconsin.
Wyoming
There is no law prohibiting lawsuit loans in Wyoming. The court systems have not yet invalidated or upheld contracts. We do offer pre-settlement loans in Wyoming.
How Lawsuit Funding Works
Lawsuit loan companies continue to explain that while they are referred to as lawsuit loans, they work like cash advances. They are non-recourse, so if you lose your case, the funding company does not get repayment. You will get legal representation from a personal injury attorney when you suffer an injury.
Step 1
As your case progresses, you might need financial assistance to pay for medical procedures or daily expenses. You cannot ask your lawyer for a loan or an advance, but you can get pre-settlement loans. Sometimes, your lawyer has referrals for trusted and reliable companies.
Step 2
Other times, you must find a lawsuit loan company independently. Silver Dollar Financial is here to help injury victims nationwide in states where we can provide financing options. You can apply online or over the phone and provide information about your injuries, case, and attorney.
Step 3
Our underwriters will contact your law firm for more details. Then if you qualify, we will send over an offer. You agree to the terms, and we send you the money, and when your lawsuit settles we will be repaid.
Significant Regulations
Many state and federal regulations exist, but much of the industry is unregulated. Since pre-settlement loans are not loans, lawmakers are unsure what else to do. These debts are unlike auto loans and credit cards, which the federal government highly regulates, including:
- Wisconsin has taken legal action against lawsuit loans through the Wisconsin Act 235. The act requires that lawsuit loans be disclosed.
- Nevada requires that legal funding companies be licensed to provide loans.
- California established a precedent in 2018 that any consumer loan over $2,500 could be challenged if the borrower believes the interest rates are high.
- Colorado took action in 2015 to handle pre-settlement funding like a conventional loan.
- Conversely, Georgia deems lawsuit loans as financial investment products, which complicates pre-settlement funding in the state.
Additionally, Nebraska has taken steps to regulate lawsuit loans by requiring pre-settlement loan companies to provide disclosures, be appropriately licensed, and give borrowers five business days to cancel their agreement. Ohio has the same regulations as Nebraska. Oklahoma bars loan companies from paying referral fees to law firms or participating in litigation.
Red Flags in Lawsuit Loans
Some red flags can make you run away when looking for a lawsuit loan company. Sometimes, people will pose as lawsuit loan companies and threaten you to repay them out of pocket. Pre-settlement loans count on winning your case, and you do not pay anything out of pocket.
Many clients will speak to their lawyer and have them review the offer and contract before agreeing to avoid missing any details. You should always read the fine print of any contract before signing. When a lawsuit loan company encourages you to leave your lawyer out of the process, that is a major red flag.
Having an attorney benefits the loan company and helps with risk assessments. Conversely, some loan companies will encourage you to work with their attorneys instead. Your lawyer has your best interests in mind, while the lawsuit loan company might not.
Most importantly, trust your gut before applying for a pre-settlement loan.
Apply for Pre-Settlement Funding from Silver Dollar Financial
Many plaintiffs are unsure of pre-settlement loans and will struggle financially until the case is resolved. A pre-settlement loan is not the best option for everyone, and legal funding companies have requirements when determining your eligibility. You can speak to your lawyer and our underwriters for more information on how lawsuit loans work and regulations regarding the loan.
Silver Dollar Financial provides multiple types of pre-settlement loans to clients with strong cases and legal representation. While adhering to all current state regulations, our pre-settlement legal funding may help you when you need it most. Fill out an online application now or call our loan specialists for more information.
Call or text +1(844)871-0628 or Apply Now for Pre-Settlement Funding