We’re big believers in transparency here at Resolution Funding, and that’s why we like to make sure our clients understand exactly what they’re agreeing to when they enter into a contract with us to receive a lawsuit settlement advance.

Once you submit an application to Resolution Funding, we review your case and offer you a pre-settlement advance (which is a calculation based on the estimated value of your final settlement). At that point, you’ll sign a contract with us that essentially states that Resolution Funding collects a portion of your settlement if you win your case. You do NOT need to repay the advance if your case does not win.

But what’s the “fine print”? Here are the basic parts of a lawsuit settlement contract:

Definition of legal advance

Sounds pretty basic and it should be. A lawsuit advance is a form of non-recourse funding, which means that you as the plaintiff do not have to repay the advance even if your lawsuit is unsuccessful. The lawsuit funding company is purchasing your right to some portion of your lawsuit award in exchange for a sum of money that they advance you. The language in this part of the contract should make it very clear that this is not a loan.

Fee disclosure

The fee disclosure explains whether your fees will compound monthly for the duration of your loan or if a flat interest rate will be used. The contract should also disclose any up-front fees, whether rates are capped at a certain amount, and whether the firm negotiates with you if a case is successful but the settlement is much less than anticipated.

Payoff schedule

Never sign a contract that doesn’t provide a clear payoff table. This schedule should show how much you’ll owe at 6, 12, 18, and 24 months after you enter into your funding agreement. It should also explain whether there is a minimum payment clause, how payback would be handled in the case of a non-compounding fee if your case settles in the middle of a fee calculation period, and how often you are allowed to pay off your loan (anytime? only every few months?).

Grace period

In any contract, the plaintiff should have the right to cancel the contract within a certain period of time of signing. The number of days may vary (for Resolution Funding, our grace period is five days), but this is an important part of the contract to look for.


Certain situations may preclude you from receiving a lawsuit advance such as bankruptcy or owing child support or back taxes. These debts would be considered valuable by the state and to be “nonexempt” property (and therefore funds that would be used to repay your debtors). In the lawsuit advance contract, therefore, you will see declarations that state that you, the plaintiff, are not in bankruptcy and do not owe any child support or back taxes.

Irrevocable letter of instruction

This portion of the contract essentially gives the plaintiff’s attorney certain instructions. By signing this section, you would be authorizing your attorney to:

  • Provide the funding company periodic status updates about your case.
  • Pay the funding company before the attorney sends you the balance of any settlement funds.
  • Give the funding company notice if your case gets any additional liens or if your case file is transferred.

Whether you’re working with Resolution Funding, proud member of the American Legal Finance Association, or another settlement funding company, we encourage you to ask questions and always review the details of any contract you sign. It’s an unfortunate reality that some firms offering pre- and post-settlement funding for personal injury cases might not be forthcoming about the details of a contract. Make sure these elements are covered and are clear to you.

If we can help by reviewing a contract you’re considering, don’t hesitate to call us at 1-855-LAW ADVANCE.