Funding has been confirmed for a class action lawsuit against the makers of defective plaster cladding.

The legal action, which will claim damages of more than $100 million, is being funded by Harbour Litigation Funding Limited.

Adina Thorn from Adina Thorn Lawyers, which is handling the case, said the funding meant there would be no out-of-pocket costs for participants.

Harbour Litigation Funding is a UK-based company which provides commercial litigation funding. It covers all legal funding to conduct a case, and takes a percentage of funds awarded. It is not repaid if the case is unsuccessful.

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Ms Thorn said the funding was an encouraging sign.

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"Harbour only invests in cases it believes have strong prospects of success so we are encouraged that they have decided to fund this class action."

More than 1200 leaky home owners have so far registered for the case.

Ms Thorn said many had lost everything and could not afford to fix their homes.

"Thousands of people and families have been left with no choice but to live in leaky, mouldy homes that can pose a significant health hazard."