Introducing Funding to Reluctant Clients: Attorney Playbook (2026)

Why This Playbook Exists

Clients approach pre-settlement funding with a wide range of prior beliefs. Some ask about it in the intake meeting; some have never heard of it and are relieved when you raise it; some have deep skepticism grounded in earlier bad experiences (theirs or a family member's) with predatory lenders. The attorney's job is to introduce the option accurately, respect the client's independence, and preserve the fiduciary relationship — regardless of whether the client ultimately chooses to use funding. This playbook consolidates the framing, scripts, and disclosures that experienced attorneys use to have this conversation without crossing ethics lines.

This is a working guide, not legal advice. Every state has its own ethics regime — see our companion piece on state bar ethics on lawsuit funding for the state-specific overlay.

When to Raise Funding

Client initiates

If the client asks about "lawsuit loans," "settlement advances," or similar concepts, Rule 1.4 requires the attorney to answer honestly. Explain that non-recourse pre-settlement funding exists, how it works generally, and what the mechanics look like at disbursement. Documentation of the conversation is prudent.

Client is in financial distress

Where a client is manifestly under financial pressure — struggling to pay rent, missing medical appointments due to transportation costs, considering settling low to end the wait — the ethical territory is more nuanced. Most state ethics frameworks permit the attorney to mention that non-recourse funding exists as an option the client may want to explore, provided the attorney does not push toward a specific funder or push funding as a solution.

Client is considering settling low to end the wait

The most difficult case. A client who wants to accept an inadequate settlement offer because they cannot afford to wait may benefit from knowing that funding is available. But the attorney's advocacy is around the settlement decision, not the funding decision — the two are separate and the client's autonomy on both must be respected.

The Introduction Script

The opening frame that works well:

"There's a financial tool called non-recourse pre-settlement funding that some plaintiffs use during long cases. It is not a loan — you only repay if the case succeeds, and the repayment comes out of the settlement. Some clients find it useful; some don't. I do not receive any fee or referral payment from any funder, and I have no financial interest in your decision either way. If you want to explore it, I can point you to some reputable options and review the contract with you before you sign. If you'd rather not think about it, that's completely fine — the option is here if you want it."

Key elements:

• Frames the product accurately (non-recourse, not a loan).
• Explicitly discloses no attorney financial interest.
• Offers to help evaluate, does not push.
• Explicitly permits the client to decline without follow-up pressure.

Addressing Common Client Concerns

"Isn't this just a loan?"

"It's structurally different. A loan you have to pay back regardless of outcome. This is non-recourse — if your case doesn't succeed, you owe nothing. That difference matters legally and financially. The tradeoff is that the effective cost is higher than a standard loan because the funder is bearing the risk of the case failing."

"The rates are predatory."

"Some funders charge unreasonable rates and some are professional. Standard market pricing is 2%–3.5% per month with a cap on total repayment. I can help you evaluate whether a specific offer is fair. If an offer looks bad to me, I'll tell you plainly."

"Will this affect my case value?"

"No. The funder has no role in litigation strategy, no visibility into settlement decisions except at the very end, and no ability to affect what your case is worth. The funding decision is separate from every other case decision."

"Will you be paid by them?"

"No. It's actually a prohibited ethics violation for me to accept any fee or benefit from a funder for referring you. I am not compensated by any funder. My acknowledgment of the assignment is a standard piece of the funder's process; it is not paid for."

"What if my case goes badly?"

"Then you owe the funder nothing. The advance is not repaid. This is the entire non-recourse feature — the funder is taking the case-outcome risk, not you."

"How much will it cost me at settlement?"

"That depends on the advance amount, the rate, and how long the case runs. Reputable funders provide an amortization schedule at contract execution so you know exactly what the payoff will be at any point. Let's walk through a concrete example."

Concrete Example to Walk Through

A worked example a client can hold in mind:

"Suppose you take a $5,000 advance today at 3% per month with a 2.5x cap. In month 12, the payoff would be about $7,100. In month 24, it would hit the cap at $12,500. If your case settles for $80,000 in month 12, your net after this advance would be $80,000 minus attorney fees, minus costs, minus liens, minus the $7,100 payoff. If your case fails, you owe nothing."

Walking clients through a specific number frame rather than an abstract explanation is dramatically more effective. Clients understand "$7,100 back on $5,000 in a year" better than "3% monthly with a 2.5x cap." For the underlying rate mechanics see our companion piece on how pre-settlement funding actually works.

What to Provide the Client

1. A neutral written summary of how non-recourse funding works.
2. A list of 2–3 reputable funders (in states requiring option-list disclosure) or a specific recommendation (in states permitting it).
3. Your commitment to review any contract before the client signs.
4. A commitment to explain the payoff math for any specific offer.
5. Your firm's standard funding-related disclosures.

What Not to Do

• Do not push the option. Present, offer to help, let the client decide.
• Do not use funding as a client-retention tool. Ethics violations follow.
• Do not accept any fee or benefit from a funder. Zero exceptions.
• Do not guarantee case outcome to a funder. Converts non-recourse to recourse and creates ethics exposure.
• Do not withhold information about a specific funder's known problems. If you know a funder has a bad reputation in your local practice, say so.

Documenting the Conversation

Standard practice:

• Note the date and substance of the funding conversation in the case file.
• Confirm any written materials provided to the client.
• Confirm the client's decision (or explicit undecision) and any next steps.
• If the client proceeds, memorialize the attorney's review of the specific contract.

When the Client Decides Against Funding

If the client decides not to pursue funding, that decision is final — do not follow up unless the client asks. If financial pressure worsens later and the client raises the topic again, the attorney can reintroduce the option; but the initial "no" should be respected on its terms.

When the Client Decides to Pursue Funding

Once a client is interested:

1. Confirm the client has the case file materials the funder will need (accident report, medical records to date, insurance information, wage-loss documentation).
2. Provide the funder with the case file after the client's application. Standard practice.
3. Review any offer the client receives. Compare rates, cap, and total repayment across offers if multiple.
4. If the terms are unfavorable, say so. The client's fiduciary interest is the reference.
5. Countersign the attorney acknowledgment. Verify it does not include a repayment guarantee.
6. Note the advance in the file for disbursement.

For the framework on how funding and medical liens interact at disbursement, see funding and medical liens. For the distribution arithmetic broadly, see settlement distribution math. Firm-facing process at our attorney resources.

The Bottom Line

Introducing pre-settlement funding to clients is a routine and unremarkable part of modern personal-injury practice when done properly. The framework is clear: inform accurately, respect client autonomy, disclose absence of financial interest, review contracts on the client's behalf, and document the conversation. Firms that build this into standard workflow deliver better client outcomes and avoid ethical friction. Firms that avoid the conversation entirely often see clients settle low for reasons that a well-timed funding conversation could have prevented.

For firms building or refining a funding-introduction workflow, our attorney resources page provides templates. To route a specific client case for evaluation, use the application portal.