Understanding the Legal Funding Process Under the Kansas Transparency in Consumer Legal Funding Act (HB 2518)
If you’re involved in a lawsuit and facing financial pressure while waiting for a settlement, legal funding may provide short-term financial relief. Kansas’ Transparency in Consumer Legal Funding Act (HB 2518), effective July 1, 2026, established important consumer protections and created a clear process for obtaining legal funding.
This guide walks you through each stage of the application process so you know exactly what to expect.
Step 1: Make Sure You Qualify
Before applying, determine whether you meet the basic requirements for legal funding.
Generally, legal funding is available to:
- Kansas residents.
- Plaintiffs involved in a civil lawsuit.
- Individuals pursuing claims such as:
- Car accidents
- Truck accidents
- Slip-and-fall cases
- Premises liability claims
- Wrongful death actions
- Other personal injury matters
Legal funding is intended to help cover personal and household expenses, not attorney fees or litigation costs.
Common Reasons People Seek Funding
- Rent or mortgage payments
- Utilities
- Groceries
- Transportation costs
- Medical bills
- Childcare expenses
If you’re waiting on a lawsuit and struggling financially, legal funding may be an option worth exploring.
Step 2: Talk to Your Attorney
Kansas law requires attorney involvement in the legal funding process.
Before applying, have a conversation with your attorney about your situation.
Questions You May Want to Ask
- Is my case likely to qualify for funding?
- How strong is my claim?
- How long might the case take to resolve?
- What is the estimated value of the case?
- Could funding help me avoid settling too early?
Because your attorney will later need to complete an attorney acknowledgment, it is best to involve them from the beginning.
Step 3: Compare Legal Funding Companies
Not all legal funding companies operate exactly the same way.
Before choosing a provider, compare several options.
Important Factors to Review
- How much funding is available.
- How quickly funds can be delivered.
- The maximum repayment amount.
- Whether all fees are clearly disclosed.
- Responsiveness and customer service.
- Explanations of non-recourse funding.
Look for Transparency
A reputable company should clearly explain:
- How repayment works.
- What you’ll receive.
- What charges apply.
- What happens if the case does not recover.
Choose a company that answers questions clearly and provides information without pressure.
Step 4: Submit Your Application
Once you’ve selected a funding company, you’ll complete a short application.
Information Typically Requested
- Your name and contact information.
- The type of case you have.
- The date of the accident or injury.
- Your attorney’s name and contact information.
- Basic information about your lawsuit.
You will also typically authorize the funding company to communicate with your attorney and review relevant case documents.
Good News
Unlike traditional lending products, legal funding approvals generally focus on the strength of your case rather than:
- Credit scores
- Employment history
- Income verification
The lawsuit itself is usually the primary factor in the approval process.
Step 5: Underwriting and Case Review
After receiving your application, the funding company evaluates the case.
The Review Process May Include
- Speaking with your attorney.
- Reviewing accident or police reports.
- Examining medical records and bills.
- Evaluating insurance coverage.
- Assessing liability and damages.
- Estimating potential settlement value.
Based on this review, the company decides:
- Whether funding will be offered.
- The amount that may be advanced.
- The terms of the agreement.
Step 6: Carefully Review the Contract
Before signing anything, carefully review the funding agreement.
Kansas law requires funding contracts to be written in plain language and contain specific disclosures.
The Agreement Should Clearly Include
- The amount you will receive.
- Itemized charges and fees.
- The maximum repayment amount.
- Your non-recourse protections.
- Your 10-day cancellation rights.
- Attorney acknowledgment language.
Before Signing
- Read every page.
- Ask questions about anything unclear.
- Verify the maximum repayment amount.
- Confirm you understand how repayment works.
You should never feel rushed to sign.
Step 7: Attorney Acknowledgment
Kansas requires attorney acknowledgment as part of the legal funding process.
Your attorney must sign a statement confirming several important items.
The Attorney Typically Confirms
- The disclosures were reviewed.
- The agreement was discussed with you.
- Settlement funds will be distributed through the attorney’s trust account.
- The attorney did not receive a referral fee.
- The attorney has no financial interest in the transaction.
- The attorney is not providing tax or financial advice regarding the funding.
This requirement helps protect consumers and preserve attorney independence.
Step 8: Receive Your Funds
Once all approvals and signatures are completed, the funding company sends the money.
Funds Are Commonly Delivered By
- ACH transfer
- Wire transfer
- Other approved electronic payment methods
Common Uses for Funding
Consumers often use funding for:
- Rent or mortgage payments
- Utility bills
- Groceries
- Transportation expenses
- Childcare
- Everyday household needs
The purpose is to help you manage financial pressure while your lawsuit continues.
Step 9: Understand Your 10-Day Cancellation Right
Kansas provides a valuable consumer protection called the 10-day rescission period.
During This Period You May
- Cancel for any reason.
- Change your mind.
- Return the funded amount.
- Cancel without penalties or fees.
If you decide funding is not right for you, follow the cancellation instructions described in your agreement.
Step 10: Continue Focusing on Your Case and Recovery
Once funding is received, continue handling your lawsuit normally.
Best Practices Include
- Following your doctor’s treatment plan.
- Attending all appointments.
- Staying in contact with your attorney.
- Keeping records organized.
Kansas law prohibits funding companies from directing legal strategy, settlement decisions, or medical treatment choices.
Your attorney remains in charge of your case.
Step 11: Settlement and Repayment
If your case settles or results in a recovery, repayment is typically handled through your attorney.
The Settlement Process Usually Includes
- The attorney requests a payoff statement.
- The repayment amount is verified.
- Repayment is deducted from settlement proceeds.
- Remaining funds are distributed to you.
Other Common Settlement Deductions May Include
- Attorney fees
- Litigation expenses
- Medical liens
- Legal funding repayment
You should receive a final settlement statement showing all deductions and payments.
Step 12: Keep Your Records
After the funding process is complete, maintain copies of all important documents.
Documents to Save
- Funding agreement
- Attorney acknowledgment
- Disclosure forms
- Payoff statements
- Repayment records
- Final settlement statement
These records can be useful if questions arise later about the transaction.
Final Takeaway
The Kansas Transparency in Consumer Legal Funding Act created a clear, consumer-friendly process for obtaining legal funding. By requiring attorney involvement, maximum repayment disclosures, non-recourse protections, plain-language contracts, and a 10-day cancellation period, Kansas gives consumers significant safeguards throughout the funding process.
Before Accepting Funding, Remember To:
- Review all disclosures carefully.
- Understand the maximum repayment amount.
- Ask your attorney questions.
- Compare funding providers.
- Keep copies of all documents.
- Use your 10-day cancellation right if needed.
When used responsibly, legal funding can provide valuable financial support while you focus on your recovery and allow your attorney time to pursue the best possible outcome for your case.