What Can I Use My Pre-Settlement Funding For?

You can use your pre-settlement advance for anything — there are no restrictions. Medical bills, rent, groceries, utilities, childcare, and any other expense are all appropriate uses.

Pre-settlement funding can be used for any purpose without restriction. The funder does not impose conditions on how you spend your advance, does not require receipts or reporting, and has no interest in your spending decisions. The advance is yours to use however your financial situation requires.

The most common uses among injury plaintiffs are: medical bills and ongoing treatment costs, rent or mortgage payments, groceries and household expenses, utilities and insurance premiums, childcare and family support costs, transportation and vehicle repairs, and replacing lost wages during recovery from injury. These are the practical expenses that accumulate when income stops and litigation begins.

Less common but entirely legitimate uses include: paying down high-interest debt to reduce monthly payment obligations during litigation, funding home modifications needed because of a disability caused by the injury, and covering costs related to the litigation itself (such as transportation to medical examinations or attorney consultations, which are not typically covered by the funding but may be your own responsibility).

One practical point: there is no benefit to taking a larger advance than you need. Interest accrues on the full advance amount from the date of disbursement, so unused funds sitting in your bank account are still generating repayment obligations. Take the amount you genuinely need, and apply for additional funding if your needs increase.

Source: ALFA Consumer Litigation Funding Code of Conduct — No restrictions on plaintiff use of funded amounts.

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