Every dollar you will owe is set out in your written funding contract before you sign it. California law requires that contract to state the amount paid to you, to itemize any one-time charges, and to state what is owed to the funding company when the case is completed. If a number was never explained to you, do not sign.
What your contract has to tell you
Under the California Consumer Legal Funding Act, Business and Professions Code sections 6250–6256, a consumer legal funding transaction has to be documented in a written contract. Among other requirements, that contract must state the amount to be paid to you and must itemize one-time charges and what you will owe the funding company on completion of the litigation.
Those are statutory minimums. They are not a substitute for reading your own agreement and reviewing it with your attorney.
Green Light's terms
FILL: your actual funding terms go here — the charge, how and how often it accrues, and whether the total payoff is capped. Pull these from your executed contract template so the page and the contract say the same thing. I have deliberately not written a number.
You will receive these figures in writing, specific to your advance, before you are asked to sign anything. Ask us to walk you through them line by line. We would rather spend ten minutes on the phone than have you sign something you do not understand.
Why it costs more than a bank loan
A lender can collect from you regardless of what happens. We can only collect from the proceeds of your claim, and if there are none, we are paid nothing and keep the loss. That is the entire difference, and it is what the pricing reflects.
Comparing a funding charge to a mortgage rate is not a like-for-like comparison, because the two products carry completely different risk. The useful comparison is between funding offers.
How to compare two funding offers
Compare the total amount you would owe at a specific date — say, eighteen months out — not the headline rate. A lower-sounding rate that compounds more often, or that has no cap, can cost more than a higher one that does.
Ask each company for a payoff table showing what you would owe at six months, twelve months, two years. If a company will not put that in writing before you sign, that answers your question.
What drives your cost up
- How much you take. The charge applies to the amount advanced, so a larger advance costs more.
- How long your case runs. Charges generally accrue over time, and you do not control the timeline.
- How many advances you take. Each one is claimed against the same recovery. See can I get more funding later.
Take the smallest amount that works
We will say this on the phone even though it is not in our short-term interest: take what covers the gap, not the maximum you qualify for. Every dollar advanced now comes out of your recovery later, and you can come back if the case drags on.
Questions worth asking any funding company
- What is the total I will owe at twelve months? At twenty-four?
- Is there a cap on what I can owe, and what is it?
- Are there application, processing, wire or origination charges?
- What is my right to cancel, and how long do I have?
- Will you send the contract in advance so my attorney can read it?
Any funder that gets uncomfortable with that list is telling you something useful.
Ask us directly
Call or text 310-303-1858, or request funding. No cost to ask, and no obligation.
More in the legal funding guide, or see pre-settlement funding in California.