The debt does not have to be repaid if the plaintiff's lawsuit is unsuccessful. In addition, litigants generally do not have to pay monthly fees in obtaining legal financing. Instead, there are no payments of any kind until the case settles or judgment is obtained, which could be months or years away. Prior to legal financing, many litigants had to settle their legal case early or for a lesser amount just to get some cash to avoid financial troubles. A major criticism of litigation funding is that it encourages frivolous claims. This argument is weakened by the fact that it is in the best interests of a litigation finance company to advance money only to those plaintiffs who, in the company’s determination, have a strong chance of succeeding. Litigation funding, also known as legal financing and third-party funding, enables a party to litigate or arbitrate without having to pay for it, whether because they are unable to pay for it or because they do not want to. The conduct of a lawsuit is called litigation. The plaintiffs and defendants are called litigants and the attorneys representing them are called litigators.
