Selling Settlements is quite easy. If you don’t know, then let me tell you that you can now sell your structured settlements to a factoring company. For any kind of emergency, if you need urgent cash, then you can liquidate your settlement payments, so you can have a lump sum amount of money which can be life-saving in that situation and can also reduce your stress.
So, in this article, I am going to discuss structured settlements and how you can sell them to different factoring companies for immediate cash. So, without any more further delay let’s dive into our topic of Selling Structured Settlements.
What Does Structured Settlement mean?
A structured settlement can be defined as the number of payments a person receives in cases he owns or settled for a civil lawsuit. For example, a personal injury lawsuit. If someone is injured while doing their job and the company is at fault for the occurrence of the injury, then they will have to pay money to that injured or permanently disabled person.
In this example, the company can accept responsibility for their fault or they can be forced to pay the money if they lose the case in court. If the amount is small, the receiving party can have a lump sum settlement. But if the amount is large, then a structured settlement annuity can be arranged.
In this agreement, a series of payments are made towards the victim as compensation for the permanent injury that is caused to them. A series of payments instead of a lump sum ensures that the receiver can have some kind of assurance for their future so, they can be able to pay for their future expenses.
Pros and Cons of Structured Settlement –
Pros of Structured Settlement –
- These payments are tax-free.
- If the recipient of this payment dies and in that case, the beneficiary will continue to accept the payment without paying any tax.
- These payments can be scheduled at any moment of your life. For example, you can choose to accept payment immediately or you can choose to accept payments after your retirement.
- They can pay your future bills. In the case of a lump sum amount, there is always a risk that the money can be spent quickly and easily.
Cons of Structured Settlement –
- The terms of this settlement are not flexible. Once they are confirmed that they can not be changed again.
- Funds are not immediately accessible right after the settlement and can take up to a few days for the payment to be accessible.
- If you decide to sell your structured settlement payments or parts of your payments, then you will have to sell them at a discounted rate.
- You will not get a huge amount of money at a time.
How to Sell Structured Settlement?
Now the owner of a structured settlement may decide to sell all of their payments or some of their payments. So in case of an immediate need for cash, the owner can liquidate his payments to have a lump sum amount for immediate need.
The terms of your settlement can decide whether you can sell your payments or not. To sell you payments you need the approval of a judge who will consider the terms of the sales, whether you are selling you full payment or a portion of it, and how it will affect your long-term financial situation. The judge will assess that is it possible for you to experience any financial hardships once you sell those payments.
Things the judge may consider when approving your selling application –
- Your regular expenses.
- your financial obligations such as mortgage or college tuition fees.
- How long are you going to live?
Who is going to buy your structured settlement?
In case if you are planning to sell your settlement payments, then in that case a factoring company is going to buy all your payments. These companies will buy your payments and they will give you cash at a discounted rate.
These types of companies first emerged in 1990 where they purchased future payments at a discounted rate. However, before selling your payments, you need to look into the factoring company that you are choosing.
Best Structured Settlement Companies –
- J.G. Wentworth
- Fairfield Funding
- Peachtree Financial.
- Stone Street Capital
- DRB Capital
- USC Claims
These are the top-most structured settlement companies in the US right now and they are also trustworthy.
Benefits of Selling your Structured Settlements?
The only reason you are selling your settlements is because of liquidity. So, in other words, you are selling your settlements because of any emergency, for example in case of a medical emergency where you don’t have insurance and need money immediately. In that case, this can help get that money and it can also bring you mental peace. This is a very good way to get cash immediately in an emergency.
Difference between Structured Settlements and Lump Sums?
Lump sums can be defined as a huge amount of money that someone will get at one time. But structured settlements can be defined as a series of payments that can be made to a particular person.
Lump sums can be very easily spent by someone where on the other hand a person will have future assurance in terms of structured settlements because these payments are made for a long amount of time. So they can’t be easily spent.
If you are getting structured settlements and you want to sell them, then I would suggest you look into the company that you are selling your payments to. Because many companies are not trustworthy.
After interacting with several different factoring companies, you will have a pretty good idea of how much money you are going to get for your payments.
Disclaimer: All the information shared on this page is based on Internet research. Before Selling Settlements, make sure to research carefully.