Most claimants want to know what percentage of the settlement will go to repay the advance. Here's how to estimate it.
The portion of your settlement that goes to repay pre-settlement funding depends on three factors: how much you borrowed, how long the case takes, and the rate schedule in your agreement.
For an advance equal to 10% of your expected settlement on a case that resolves in 12 months, the total payoff typically ranges from 1.3 to 1.7 times the advance amount, depending on the funder.
On a $50,000 settlement with a $5,000 advance, that puts the total payoff around $6,500 to $8,500, leaving the rest of the settlement (after attorney fees and liens) intact.
Borrowing less, settling sooner, and choosing a funder with capped payoffs all reduce the percentage of the settlement consumed by the advance.
AARC always provides a written payoff schedule before you sign so you can see exactly what you'd owe at various case durations.
Call (800) 297-3834 or apply online to see your specific projected payoff.
