Law Firm Loans - NexGen Lending

Short answer: Most law firms use a business line of credit to cover payroll, rent and case costs while fees are pending, a term or SBA loan to buy a practice, open an office or renovate, and equipment financing for technology. Lenders focus on firm revenue, collections history, practice area, case pipeline and the partners’ credit.

At a glance

Best for cash flow: Business line of credit
Best for growth: Term loan or SBA 7(a) loan
Best for technology: Equipment financing (computers, servers, phones, furniture)
NexGen amounts: $10,000 to $20,000,000 across programs
Approval speed: Typically 1 to 24 hours for many programs
Credit: 650+ on most programs; 500+ for revenue-based financing; 700+ for SBA loans

Law firms often earn well but get paid unevenly. Hourly clients pay on invoice terms, and contingency practices may carry case costs for months or years before a settlement or verdict. Meanwhile salaries, rent, malpractice insurance and technology costs arrive every month. This guide covers financing for solo practitioners, small and mid-sized firms, personal injury and contingency practices, and firms buying or merging with another practice.

At NexGen Lending, we help professional practices nationwide compare working capital, expansion and acquisition financing with one application.

What is the best financing for a law firm?

Short answer: A business line of credit is usually the best tool for smoothing uneven collections, because you draw only what you need. A term or SBA loan suits one-time investments like buying a practice, adding an office or a renovation, and equipment financing covers technology and furniture.

Financing type	Best for
Business line of credit	Payroll, rent and case costs between collections
Term loans & unitranche debt	New offices, renovations, hiring attorneys, marketing
SBA 7(a) loan	Buying a practice, partner buyouts, refinancing
Equipment financing	Computers, servers, phone systems, furniture
Real estate funding	Using equity in the firm’s office or a partner’s home to fund growth

How do contingency firms manage case costs?

Short answer: Contingency firms often use a business line of credit or term loan to cover expert fees, depositions, filing costs and overhead while cases are pending, then repay as settlements come in. Rules on financing tied to specific cases vary by state, so firms should review their state’s ethics rules before using case-specific funding.

A firm-level line of credit, based on the firm’s overall revenue and history, keeps financing separate from any individual client matter. Talk to your bar association or ethics counsel if you have questions about what’s permitted where you practice.

What is a collections cycle? It’s the time between doing the work and actually receiving payment, whether that’s an invoice paid on terms or a contingency fee paid at settlement. Lenders look at how long your cycle runs and how consistent collections are.

What do lenders look for in a law firm?

Short answer: Lenders review firm revenue and collections history, practice areas, mix of hourly and contingency work, accounts receivable, the case pipeline, time in business, partner credit, existing debt and office lease terms. Firms with steady collections and a diverse client base have the most options.

Annual and monthly revenue and collections history
Practice areas and mix of hourly, flat-fee and contingency work
Accounts receivable aging
Time in business and attorney experience
Partner or owner credit
Existing debt and lease terms

How do I qualify for a law firm loan?

Short answer: Keep operating funds separate from client trust accounts, track collections and receivables, prepare recent financial statements and tax returns, and explain how the financing grows revenue. Lenders only consider the firm’s operating revenue, never client trust funds.

Keep trust and operating accounts separate. Lenders look only at operating revenue.
Track receivables. An aging report shows how quickly clients pay.
Prepare financials. Recent tax returns, P&L and balance sheet support larger requests.
Document your pipeline. For growth loans, show the cases or clients the investment supports.
Plan for uneven months. See our cash flow planning guide.
Compare offers. See how we compare lender offers.

Can a new law firm get a loan?

Short answer: Yes, though new firms have fewer options. Lenders weigh the attorneys’ experience, existing client relationships, personal credit, a business plan and owner investment. Equipment financing for technology and SBA loans are common starting points for attorneys launching their own practice.

How fast can a law firm get funded?

Short answer: Many NexGen programs approve in 1 to 24 hours, which helps with payroll and short-term gaps. SBA loans for practice acquisitions and real estate purchases usually take several weeks.

Frequently asked questions about law firm financing

Can I use a loan to buy an existing law practice?

Yes. SBA 7(a) loans are commonly used to buy practices and fund partner buyouts. See our guide to buying an existing business.

Can client trust account funds be used to qualify?

No. Client trust funds belong to clients. Lenders look only at the firm’s operating revenue.

Is a line of credit or a loan better for a law firm?

A line of credit is usually better for uneven collections. A term loan is better for one-time investments like an office build-out.

Can a solo attorney get financing?

Yes. Solo practitioners commonly use lines of credit, equipment financing and term loans sized to their revenue.

What if my credit isn’t perfect?

With a 500 to 649 credit score, revenue-based financing is the main option, since it leans on sales more than credit. Most other NexGen programs, including equipment financing and lines of credit, require 650+, and SBA loans require 700+. Below 500, NexGen's business credit guidance can help you understand your credit profile and build toward approval.

Ready to grow your practice? Apply now or call (908) 639-4361.

This article is for general informational purposes only and is not financial, legal, or tax advice. NexGen figures come from NexGen’s service pages as of October 2026. Rules on law firm and litigation financing vary by state; consult your state bar or ethics counsel. Loan terms, rates, and eligibility vary by lender and program and are subject to approval. Availability varies by state.

Law Firm Loans: How Law Practices Get the Right Financing