Can I get a cash advance on my lawsuit in Rhode Island, and what does Rhode Island law say?

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

Bills that would change the rules

Rhode Island legislators have tried two approaches.

The first would bring advances under the usury law. 2019 H 5477, filed February 14, 2019 by Representatives Craven, Millea and McEntee, and 2025 H 5907, filed February 28, 2025 by Representatives Potter, Baginski, Batista, Shanley and Dawson, would each add a chapter on “Litigation Lending Agreements” to Title 9. Any amount a litigant repays beyond what was received would count as interest under the usury chapter, whatever the contract calls it and even though repayment depends on the case. The bills’ findings say these contracts carry annual rates “far exceeding state usury limits,” often above 100 percent. Advances by a lawyer under Rule 1.8(e) are excluded.

The second approach is regulation. 2026 H 7080, the Third-Party Litigation Financing Consumer Protection Act, filed January 14, 2026 by Representative Alex S. Finkelman, would require funders to register with the Department of Business Regulation and post a bond of at least $50,000. Contracts would have to show, in bold type, a five-business-day right to cancel, a fee limit the funder fills in, the consumer’s control over the case and no liability beyond the recovery. The bill sets no rate of its own, bans referral fees to or from lawyers and medical providers, and makes a contract that violates it unenforceable against the consumer.

All three were referred to the House Judiciary Committee. When we checked the official chapter lists for Title 6 and Title 9, neither the 2025 chapter nor the 2026 chapter was there. For how cancellation rights work in states that have them, see right to cancel lawsuit funding.

Rhode Island’s usury law

• The limit. Interest may not exceed “the greater of twenty-one percent (21%) per annum” or nine percentage points plus the domestic prime rate (R.I. Gen. Laws 6-26-2). Licensed pawnbrokers and credit card transactions are outside that section, and a commercial loan of more than $1,000,000 that meets certain conditions has no limit.
• The consequence. A contract that violates section 6-26-2 is “usurious and void,” and a borrower who has paid principal or interest may recover the amount paid (6-26-4). For regulated financial institutions the result is different: forfeiture of the interest, and twice the interest paid if the borrower sues within two years.

Those are strong remedies, which is why the loan question matters so much here. The 2019 and 2025 bills were written to answer it for litigation advances. Without them, a Rhode Island court would have to decide whether a non-recourse advance is a loan, and we found no Rhode Island appellate decision doing so. For how courts elsewhere have ruled, see is a lawsuit cash advance a loan.

Lender licensing

Under R.I. Gen. Laws 19-14-2, no one may engage in “making or funding loans or acting as a lender or small loan lender,” or in brokering loans, without a license. The definitions in 19-14-1 are broad: a “loan” is “any advance of money or credit including, but not limited to” a list of examples, and a “small loan” is one of less than $5,000, not secured by real estate. Whether that wording reaches an advance owed only if a case wins has not been tested in a Rhode Island appellate court that we found, and we found no published guidance from the Department of Business Regulation on it.

Champerty and lawyers in Rhode Island

We found no Rhode Island appellate decision applying champerty, the old rule against an outsider buying a share of someone’s lawsuit, to a consumer advance. We also did not verify the current text of Rhode Island’s Rule of Professional Conduct 1.8(e) on an official court site. The 2019 and 2025 bills refer to that rule only to exclude a lawyer’s advances of litigation expenses from their coverage.

Your filing deadline in Rhode Island

“Actions for injuries to the person shall be commenced and sued within three (3) years next after the cause of action shall accrue.” Subsection (c) adds 120 days in a narrow situation involving a direct claim against an insurer, and claims of child sexual abuse follow section 9-1-51 (R.I. Gen. Laws 9-1-14(b)). An advance does not stop that clock.

What to ask before you sign

• Does the company hold a Rhode Island lender license under chapter 19-14? If not, why does it say it needs none?
• What annual rate does the payoff equal at 12 and 24 months, and how does that compare with the 21 percent figure in section 6-26-2?
• Can you cancel after signing, and for how many days? No Rhode Island statute gives that right today.
• Has your lawyer reviewed the contract? Our contract red flags page lists terms to look for.

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.