Ohio HB 105: What the New Non-Recourse Litigation Funding Law Means for You
Ohio has updated its rules for non-recourse litigation funding agreements—here’s what claimants and funders need to know.
See if you qualify for compensation →Ohio HB 105 revises the regulations for non-recourse litigation funding agreements, impacting how individuals and companies handle legal claim financing in the state.
This new law, signed on July 7, 2026, aims to clarify and update the standards for these funding arrangements, which allow claimants to receive financial support for lawsuits without owing repayment if they lose.
Understanding these changes is crucial for anyone considering litigation funding in Ohio, as the law may affect eligibility, contract terms, and the rights of both claimants and funders.
This article explains what non-recourse litigation funding is, how Ohio HB 105 changes the landscape, and what steps claimants should take to protect their interests under the new law.
What Is Non-Recourse Litigation Funding?
Non-recourse litigation funding is a financial arrangement where a third-party funder provides money to a claimant involved in a lawsuit, and the claimant only repays if they win or settle the case.
This type of funding helps individuals cover living expenses, legal fees, or other costs during lengthy legal battles, especially when they lack other resources.
Unlike traditional loans, non-recourse funding does not require repayment if the claimant loses the case, making it less risky for those pursuing uncertain claims.
Funders evaluate the merits of a case before offering funding, and their return is typically a portion of the settlement or judgment if the claimant prevails.
- No repayment required if the claimant loses
- Funds can be used for living or legal expenses
- Approval depends on the strength of the legal claim
- Repayment comes from the case proceeds, not personal assets
Non-recourse litigation funding offers financial relief without personal risk if your case is unsuccessful.
Sources: Official source
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Consult a Lawyer →How Does Ohio HB 105 Change Litigation Funding Agreements?
Ohio HB 105 updates the legal framework for non-recourse litigation funding agreements, introducing new rules and standards for these contracts.
The law aims to provide clearer guidance for both claimants and funding companies, ensuring transparency and fairness in how agreements are structured and enforced.
While the specific provisions should be reviewed in the official text, the law may address issues such as contract disclosures, claimant rights, and funder obligations.
For example, Ohio HB 105 could require more detailed disclosures about fees, repayment terms, and the claimant’s rights, helping individuals make informed decisions about entering into funding agreements.
- Clarifies rules for non-recourse funding contracts
- May require clearer disclosures and contract terms
- Aims to protect claimants and set standards for funders
Ohio HB 105 brings new clarity and protections to litigation funding agreements in the state.
Sources: Official source
Do you qualify for non-recourse litigation funding under Ohio HB 105?
Do you have a pending legal claim or lawsuit in Ohio?
Are you seeking financial assistance to cover legal expenses without the obligation to repay if you lose?
Has your attorney agreed to consider third-party litigation funding?
Who Can Benefit from Non-Recourse Litigation Funding in Ohio?
Individuals involved in lawsuits in Ohio who need financial support during their case may benefit from non-recourse litigation funding under the new law.
This includes personal injury claimants, workers’ compensation applicants, and others with pending legal claims who face financial hardship while waiting for a resolution.
Ohio HB 105 may expand or clarify eligibility, but claimants should always review the official law and consult with a qualified professional before entering into any agreement.
For example, a personal injury plaintiff who cannot work due to an accident may use litigation funding to pay rent and medical bills while their case is pending, without risking personal assets if the case is lost.
- Personal injury claimants
- Workers’ compensation applicants
- Individuals with pending civil lawsuits
- Those facing financial hardship during litigation
Non-recourse funding can help claimants bridge the financial gap during long legal proceedings.
Sources: Official source
Key Considerations Before Entering a Litigation Funding Agreement
Claimants should carefully review all terms and disclosures before signing a non-recourse litigation funding agreement under Ohio HB 105.
It is important to understand the total cost, including any fees, interest, or percentage of the recovery that the funder will claim if the case is successful.
Ohio HB 105 may require clearer contract language and disclosures, but claimants should still ask questions and seek legal advice to ensure they are making an informed choice.
A non-obvious factor: Some funding agreements may include clauses about settlement approval or communication with your attorney—always check how these provisions affect your control over the case and discuss them with your lawyer.
- Read all contract terms and disclosures
- Ask about total repayment amounts and fees
- Discuss the agreement with your attorney
- Understand how the funder’s involvement may affect your case
Careful review and legal advice are essential before committing to litigation funding.
Sources: Official source
How Ohio HB 105 Affects Litigation Funding Companies
Litigation funding companies operating in Ohio must now comply with the updated regulations set forth by HB 105.
The law may require funders to provide more transparent disclosures, standardize contract terms, and follow new procedures for interacting with claimants and their attorneys.
Companies should review the official law to ensure their agreements and practices meet the new standards, as non-compliance could result in penalties or contract disputes.
For example, a funding company may need to update its contract templates and train staff on the new disclosure requirements to avoid legal challenges or regulatory action.
- Update contracts to meet new legal standards
- Ensure transparent disclosures for claimants
- Train staff on compliance with Ohio HB 105
Funding companies must adapt to Ohio HB 105 to operate legally and ethically in the state.
Sources: Official source
Comparing Non-Recourse Litigation Funding to Traditional Loans
Non-recourse litigation funding differs from traditional loans in several key ways, especially under Ohio’s updated legal framework.
With non-recourse funding, repayment is only required if the claimant wins or settles the case, while traditional loans must be repaid regardless of the case outcome.
Traditional loans may require collateral or affect credit scores, but non-recourse funding is based solely on the merits of the legal claim and does not impact personal credit.
Claimants should weigh the pros and cons of each option, considering their financial situation, risk tolerance, and the specifics of their case.
- Non-recourse funding: No repayment if you lose
- Traditional loan: Repayment required regardless of outcome
- Non-recourse: No impact on credit score
- Traditional: May require collateral or credit check
Non-recourse litigation funding offers unique protections not found in standard loans.
Sources: Official source
When to Choose Non-Recourse Litigation Funding
Claimants should consider non-recourse litigation funding when they need financial support during a lawsuit and want to avoid personal liability if the case is lost.
This option is best for those with strong legal claims, limited access to traditional credit, or urgent financial needs that cannot wait for a legal resolution.
However, it is important to compare the costs and terms of funding agreements and to seek legal advice to ensure the arrangement aligns with your interests.
For instance, a claimant facing eviction due to lost income from an accident may choose non-recourse funding to stay afloat during the litigation process, knowing they will not owe repayment if their case is unsuccessful.
- Best for claimants with strong cases and urgent needs
- Useful when traditional loans are not an option
- Consider costs and legal implications before deciding
Non-recourse funding can be a lifeline for claimants with limited financial resources and strong legal claims.
Sources: Official source
Frequently asked questions
What is Ohio HB 105 and when does it take effect?
Ohio HB 105 is a law that revises regulations for non-recourse litigation funding agreements in the state. The law was signed on July 7, 2026; check the official text for the effective date and details.
How does non-recourse litigation funding work under Ohio law?
Non-recourse litigation funding allows claimants to receive money for their lawsuit expenses and only repay if they win or settle. Ohio HB 105 updates the rules for these agreements—review the official law for specifics.
Who is eligible for non-recourse litigation funding in Ohio?
Eligibility depends on the merits of your legal claim and the funder's criteria. Ohio HB 105 may clarify or expand eligibility, so check the law and consult a professional before applying.
What should I look for in a litigation funding agreement?
Look for clear disclosures about fees, repayment terms, and your rights. Ohio HB 105 may require better transparency, but always read the contract and seek legal advice.
Are there risks to using non-recourse litigation funding?
The main risk is the cost, as funders may claim a significant portion of your recovery if you win. You do not owe repayment if you lose, but always review the agreement carefully.
How does Ohio HB 105 affect litigation funding companies?
Companies must comply with new standards for contracts and disclosures under Ohio HB 105. Non-compliance could lead to penalties or disputes—review the law for requirements.
Where can I find the official text of Ohio HB 105?
You can read the full text of Ohio HB 105 on the Ohio Legislature’s website: https://www.legislature.ohio.gov/legislation/136/hb105.
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