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Five funding options for plaintiffs strapped for cash

Just because you have grounds for a lawsuit doesn't mean you have the capital necessary to bring charges against a prospective defendant. Oftentimes, prospective plaintiffs will have an airtight case, capable of winning them tens of thousands of dollars or more, but they're put in a compromising position that prevents them from being able to follow through with the proceedings.
The funding problem

In many cases, these justifiable lawsuits are the result of a personal injury or accident where a defendant is at fault. The plaintiff may be unable to work, or may be otherwise forced into unusual or difficult circumstances that make day-to-day living unmanageable. They may face the threat of impending medical bills, or have difficulty making ends meet in these situations.

To make matters worse, insurance companies often count on this predicament, and intentionally draw out legal proceedings to put even more pressure on the plaintiff. Eventually, many plaintiffs are forced into accepting a low-ball deal, just so they can make ends meet. Fortunately, there are some alternative options for raising capital to avoid such an end.

Some factors for consideration

Before you seek funding for a lawsuit, there are a few important considerations you’ll need to bear in mind:
  • Not all lawsuits have an equal chance of success. Only about half of all lawsuits end with the plaintiff getting between 50 and 100 percent of the claimed amount. Your chances will vary based on your circumstances, so don’t assume you’re going to win.
  • The process is almost always long and complicated. Even with funding in hand, be prepared for a long and sometimes arduous legal battle.
  • Some offers are worth considering. Yes, in many cases, insurance companies and defense attorneys will try to give you a low offer, but some offers are worth considering — especially since you can avoid a trial if you take them.
Funding options

With these considerations in mind, there are a handful of funding options you can seek to get through the trial and earn the settlement you deserve:
  1. Lawsuit funding. As the name suggests, lawsuit funding is a way of securing capital to keep up with daily living expenses and legal fees during the proceedings. In most cases, this is distributed as an advance by a lawsuit funding company that has underwritten and approved of a promising case. In these scenarios, the plaintiff only has to pay back the advance in the event of a favourable outcome — making it a low-risk and fast source of income if you have a good shot at victory.
  2. Friends and family members. Though it may be an uncomfortable subject to broach depending on your current relationships, you should be to talk to your friends and family members about borrowing money. If they’re unwilling or unable to provide you with direct funding, they may be able to offer support in other ways, such as helping you with day-to-day tasks or bringing you food. If nothing else, you can at least rely on them for some emotional support while you try to find a way to get through the legal proceedings.
  3. A loan against a 401(k). Most people don’t realise this, but it’s possible to take a loan out against the principal of your 401(k), usually up to 50 percent of the funds you’ve invested. This isn’t an ideal scenario, but if you have a good 401(k) plan through your employer, and a decent amount of capital saved up, it could be a solid last option.
  4. A bank line of credit. Depending on your credit history and your current assets, you may be able to establish a bank line of credit. Doing so will give you some extra wiggle room for your expenses while you try to make ends meet and hold out for a larger settlement.
  5. Personal savings. Again, this isn’t an ideal option, but it is an option. If you’ve planned ahead, you probably have some emergency savings, or maybe even a retirement fund. Dipping into these savings accounts, you can often find enough capital to stay afloat.
These funding methods all have different advantages and disadvantages, but if you have a good case, it’s worth seeking the extra funding so you can hold out for a better deal or award. Don’t let yourself be bullied or intimidated into accepting an offer that doesn’t adequately cover your medical expenses or your pain and suffering.

27 Jul 2016 12:58


About Boris Dzhingarov

Boris Dzhingarov graduated UNWE with a major in marketing. He is the CEO of ESBO ltd brand mentioning agency. He writes for several online sites such as,,, Boris is the founder of and