A lawsuit loan is advance money provided to someone fighting a lawsuit, generally a personal injury case. This money is provided on a no-recourse condition, which means that if the plaintiff loses the lawsuit, he or she is under no obligation to pay back the money. In case he or she wins compensation for the injury, the loan amount is settled from a part of the compensation paid to the plaintiff.

A lawsuit advance is a risky investment for any financial institution, as there is no guarantee of repayment. The high risk involved, which can be difficult for the investor to evaluate, means that the lender will charge a high rate of interest for the said loan. Because of this risk factor, most banks have not entered the lawsuit loan market. It is also for this reason that such a loan is considered as an investment by most lenders, even though there is no guarantee for the return of the money.

Despite the high rate of interest, a plaintiff often has no option left but to go in for such a loan.
interest only mortgage

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