Hidden Fees to Avoid

The advertised cost of a pre-settlement advance is only part of the story. Many funders add fees, penalties, and contract structures that significantly increase what you actually pay beyond what you expected.

Why Hidden Fees Exist

Litigation funding is a competitive industry. To attract plaintiffs, many funders advertise low rates. But those low rates are often offset by fees and contract structures that inflate the real cost far beyond what was advertised. It’s the same tactic used by some credit card companies and payday lenders: make the headline number look attractive while burying the true cost in the fine print.

The Fees to Watch For

Application or Processing Fees

Some funders charge upfront just to evaluate your case, regardless of whether you’re approved. Even worse, some add the application fee to your advance amount and charge interest on it meaning you’re paying costs on money you never received.

ClaimBridge: No application fee. No processing fee. Evaluating your case costs you nothing.

Origination Fees

An origination fee is deducted from your funding before you receive it, but your repayment is calculated on the full pre-deduction amount. You’re paying for money you never got.

ClaimBridge: No origination fee. If you’re approved for a certain amount, you receive that full amount.

Administrative and Servicing Fees

Monthly or annual account maintenance charges that accumulate alongside your repayment obligation, adding hundreds or thousands of dollars over the life of your advance.

ClaimBridge: No administrative fees. No servicing fees. No monthly charges of any kind.

Broker or Referral Fees

If you applied through a third-party broker rather than directly with a funder, a referral fee may be built into your cost without your knowledge.

ClaimBridge: We reach out to you directly. No brokers, no middlemen, no referral fees.

Early Repayment Penalties

Some funders penalize you for paying off your advance early, meaning you don’t benefit from a shorter case duration.

ClaimBridge: No early repayment penalties. If your case settles quickly, you save money.

Deceptive Pricing Structures

Low advertised cost with aggressive compounding. A low monthly rate compounds into a much higher effective annual cost. Always ask how the repayment is calculated and whether it compounds.

Tiered increases. A low introductory rate that jumps after a set period can produce dramatically higher total costs than a consistent structure throughout.

Fees that compound. When application or origination fees are added to the advance amount and compound alongside it, the true cost exceeds the sum of the individual charges.

How to Protect Yourself

Before signing any funding agreement, ask the funder to provide the following in writing:

1. The exact amount you will receive in your bank account
2. The total amount you would owe at multiple settlement timelines
3. Whether there is a repayment cap and what it is
4. Confirmation that there are no additional fees beyond what is shown

If the funder can’t or won’t provide these numbers in writing, that tells you everything you need to know.

The ClaimBridge Guarantee

We built ClaimBridge to be the opposite of everything described in this article. Our entire cost is one transparent repayment structure with a 24-month cap. No application fees, no origination fees, no administrative fees, no broker fees, no early payment fees, no tiered increases. The cost we quote is the cost you pay, and we show you the full picture before you sign.

We believe the litigation funding industry has earned its reputation for hidden costs and predatory practices. We’re here to change that one transparent funding agreement at a time.