The Twelve Questions
1. Is this truly non-recourse?
If I lose, do I owe anything? The answer must be a clear, unqualified no.
2. What is the full payoff schedule?
Get the dollar payoff at 6, 12, 18, 24, and 36 months in writing.
3. How is the fee calculated?
Flat fee tiers? Compounding? Daily, monthly, or quarterly? Understand the math.
4. Is there a minimum holding period or minimum fee?
Short-case minimums can dwarf the cost on a fast settlement.
5. Are there any application or origination fees?
Reputable funders charge nothing upfront. Walk away from fees billed at signing.
6. What happens if my case settles for less than expected?
Will the funder reduce the payoff to avoid leaving you with nothing?
7. Can I prepay without penalty?
Early settlement should save you money, not cost extra.
8. What happens if I switch attorneys?
The funding agreement should accommodate attorney changes without penalty.
9. Will my information stay confidential?
Confirm in writing that the funder will not contact the defense or share your information.
10. Is the agreement compliant with my state's rules?
State rules differ — make sure the contract reflects yours.
11. Who do I contact if questions come up?
You should have a direct human contact, not a generic 800-number queue.
12. Has my attorney reviewed and approved this agreement?
Always yes. Always before signing. Always.
The Big Picture
If a funder rushes you, dodges questions, or refuses to provide a clear payoff schedule, that is your answer — about whether to do business with them. See best practices for the rest of the prep work.
Sources & Further Reading
For broader context, see Federal Trade Commission — consumer guidance on financial agreements. This article is general educational information and does not constitute legal or financial advice.
Frequently Asked Questions
Sometimes — especially on strong cases. It never hurts to ask.
Yes when possible. Comparing two or three offers reveals what fair pricing looks like in your situation.