Education
Lawsuit Loan vs Bank Personal Loan: Five Key Differences
• 2 min read
Bank personal loans are cheaper if you qualify — but most injured claimants can't get one. Here's the realistic comparison.
Bank personal loans typically require strong credit (680+), stable employment, and documented income. Injured claimants who can't work often don't meet those criteria.
Even claimants who qualify face APRs of 8% to 20% and monthly payments that must be made regardless of case outcome or future income.
Pre-settlement funding has no credit check, no income requirements, no employment requirements, no monthly payments, and no recourse if the case loses.
For claimants who qualify for a bank loan and are confident in case timing, the bank loan is usually cheaper. For everyone else, pre-settlement funding is structurally the better option.
AARC can run a side-by-side comparison for your specific situation. Call (800) 297-3834 or apply online.
We'll give you a clear written cost projection before you commit to anything.
Frequently asked questions
- Will taking an advance reduce my settlement?
- The advance plus its flat fee is repaid out of the settlement, so your net proceeds are reduced by that amount. It does not affect the gross value your attorney negotiates.
- Is a pre-settlement cash advance a loan?
- No. It is non-recourse funding tied to your personal injury claim. There are no monthly payments, and if your case does not recover, you owe nothing.
- Do I need good credit or a job to qualify?
- No. AARC does not run a credit check and does not require employment or income verification. Approval is based on the strength of your claim and your attorney's representation.
- How fast can I get funded?
- Most approved applicants receive funds in as little as 24 hours once AARC has the case documents from your attorney.
- How much does it cost?
- AARC uses a flat fee rather than compounding monthly interest. Typical advances are $500, $750, or $1,000, and the illustrative payoff at settlement is 2x the advance amount.
About the author
Written by the funding team at AARC — Accident Advance & Resource Center. AARC underwrites pre-settlement cash advances for personal injury claimants and works directly with plaintiff attorneys across 45 states. Our team reviews case documentation daily and writes from that firsthand experience.
This article is general information, not legal or financial advice. Always confirm details with your attorney. Contact AARC or call (800) 297-3834 with questions about your specific case.