Pre-settlement funding, also known as consumer legal funding, operates on a non-recourse basis, meaning that if you don’t receive a financial settlement from your claims, you aren’t obligated to repay the funding company. This arrangement differs from traditional loans in that there are no monthly payments or risk of collections actions. Instead, the funding is repaid directly from the proceeds of the settlement, ensuring that you only repay if and when you receive compensation. It’s a useful option for individuals who need immediate financial support while awaiting the resolution of their legal claims.