Can I get a cash advance on my lawsuit in Washington, D.C., and what does D.C. law say?

By Michael Shemtoub, trial attorney, Beverly Law. Updated November 2026.

D.C.’s interest limits

Under D.C. Code 28-3301(a), a written contract may provide for interest “at a rate not exceeding 24% per annum.” D.C. Code 28-3303 defines usury: a verbal agreement to pay more than 6 percent a year, or a written one above the rate that 28-3301 or 28-3308 allows. The consequence is stiff. When a contract is usurious, “the creditor shall forfeit the whole of the interest so contracted to be received.”

So if a D.C. court treated a nonrecourse advance as a loan of money and the charges ran past 24 percent a year, the funder could lose all of the interest it contracted for, including the part under the cap. Whether a court would treat it that way is the open question. Funders point out that you owe nothing if the case is lost; courts in other states have split on whether that keeps the deal outside lending law. That debate is laid out on is a lawsuit cash advance a loan.

The money lender license law

D.C. Code 26-901 makes it “unlawful and illegal to engage in the District of Columbia in the business of loaning money upon which a rate of interest greater than 6% per annum is charged on any security of any kind” without a license. The license is now issued as a Financial Services endorsement to a basic business license. We found no D.C. decision or regulator statement on whether a company making lawsuit advances needs it.

Champerty is still alive in D.C.

The D.C. Court of Appeals has kept champerty as a reason to refuse enforcement of a contract. In Marshall v. Bickel (1982), a case about a lawyer’s contingent fee, the court listed three elements of common-law champerty: the fee comes out of the recovery, the person has no independent claim to the recovery, and the costs are carried with no expectation of reimbursement. It found no champerty there because the client had agreed to pay the litigation costs.

In Papageorge v. Banks (2013), a man had financed another person’s lawsuit in exchange for a share of the recovery and claimed his own interest in the property involved. The court said that if an agreement is champertous, D.C. courts “will not enforce it,” and they deny recovery for the value of services too. It also said that many arrangements once seen as champertous no longer are, which does not mean the law of champerty “has therefore been abolished.” The court sent the case back because a trial was needed on whether he honestly and reasonably believed he had an independent interest.

How those elements would apply to a consumer advance, where the funder expects repayment only from a win, has not been decided by any D.C. court we found. A funder’s role in your case matters to that analysis; see can a funding company control my case.

D.C. lets your lawyer help with living costs

This is where D.C. differs from most states. ABA Model Rule 1.8(e), which most states follow, bars a lawyer from paying a litigation client’s living expenses, apart from a narrow exception for modest gifts to indigent clients represented for free. D.C. Rule of Professional Conduct 1.8(d) instead allows a lawyer to pay the expenses of litigation and also “other financial assistance which is reasonably necessary to permit the client to institute or maintain the litigation or administrative proceedings.”

Comment 9 explains that “a lawyer may pay medical or living expenses of a client to the extent necessary to permit the client to continue the litigation.” The goal is “to avoid situations in which a client is compelled by exigent financial circumstances” to settle on poor terms for quick money. The comment limits this to what is strictly necessary and says it does not allow lawyers to “bid” for clients (D.C. Rule 1.8).

The rule allows this help without requiring it, and a lawyer may decline. If your case is in D.C., ask your lawyer before you sign with a funder. Our page on whether your lawyer can give you money before settlement compares the rules across states.

Your filing deadline in D.C.

D.C. Code 12-301 has no item labeled personal injury. Negligence injury claims generally fall under item (8), actions “for which a limitation is not otherwise specially prescribed,” which allows three years. Item (4) sets one year for claims such as assault and battery, and sexual abuse claims have their own longer periods. An advance does not pause any of these.

What to ask before you sign

• Would your lawyer consider help under D.C. Rule 1.8(d) for the specific expense that is pressing you?
• What annual rate do the contract’s charges work out to, and how does it compare with the 24 percent figure in 28-3301?
• Does the funder hold a D.C. license of any kind, and will it show it to you?
• Does the contract give the funder any say over settlement?

Common questions

Related pages

Cash advance on a lawsuit · Laws by state · Injury law FAQs

Important: This page is general information, not legal or medical advice, and reading it does not create an attorney-client relationship. Every case is different; talk to a lawyer about yours. Texas cases are handled by the firm’s Texas-licensed attorneys, Joyce Ondich and John Efstathiou. Last reviewed: November 7, 2026.