Receivable

A receivable is a right to future payment, in this asset class typically a litigation finance advance, a law firm fee receivable, or a judgment, used as collateral in a borrowing base or securitization structure. Legal receivables lack a fixed maturity and are frequently non-recourse, distinguishing them from conventional trade receivables.

A receivable, in conventional finance, is a right to receive a future payment, typically supported by an underlying obligor with an independent capacity to pay on a defined schedule. A legal receivable, a litigation finance advance, a law firm's contingency fee interest, or a judgment awaiting collection, shares the legal form of a receivable while differing from a conventional one in almost every dimension a lender actually cares about: it has no fixed maturity, since resolution timing is itself uncertain and distributed rather than scheduled; it is frequently structured non-recourse to the underlying claimant, meaning realizable value depends entirely on the matter's actual resolution rather than on an obligor's independent balance sheet; and its value moves on procedural events, a judge assignment, a motion ruling, a defendant's shift in settlement posture, that a conventional receivable's value simply does not experience. These differences are why a borrowing base or securitization structure built around legal receivables needs its own eligibility criteria, its own percentile-based advance rate methodology, and its own model-driven re-scoring discipline, rather than the periodic, manual review cadence that suffices for conventional trade receivables financing, since none of that cadence's usual assumptions about a fixed schedule actually hold for this collateral type.