Each individual has different reasons for wanting to sell their structured settlement, however, first you must decide if it is the right decision for you.
A structured settlement often follows a life changing incident, whether it be positive or negative. Due to these circumstances, you may be faced with the need for a big lump sum payment than tiny monthly payments over a quantity of years. So, where do you turn? To a company that can buy your structured settlement from you and turn it in to an immediate payment that you may use on whatever you see fit.
The Benefits of Selling Your Structured Settlement
A big portion of those who receive a structured settlement can benefit from selling it for a lump sum payment. The situations listed in this section represent possible circumstances of individuals that may get the most rewards from selling their structured settlement.
· If you and your relatives decide that this is the time to finally make that big purchase that you have had your eye on. For example, if you have previously been denied mortgages or loans and would like to take this opportunity to buy that dream home you have always wanted. Or if you have a infant or infants who are preparing to be going off to college and you fear you may not have the financial means to support that dream otherwise.
· If you cannot wait to get tiny, spread-out payments over a long duration of time due to a dire financial situation or hefty medical bills and/or lawyer fees. Lots of of the situations that can bring about a structured settlement can also stick the individual with such obligations.
· If you have talked with a financial advisor and both of you feel that you could profit more by investing a lump sum payment, than waiting on monthly payments. If the funds is invested properly, there is a chance that you could finish up with more funds in the finish than your settlement was ever worth. However, this should not be a plan that is entered in to lightly. You should work closely with a financial specialist and feel confident that you have found a great opportunity to invest in.
· If you are of older age and feel that you may not be around long to receive a fair amount of your structured settlement. You may need to the chance to enjoy the benefits of your settlement or may need to secure part of it for your relatives after your passing. This way you can distribute the funds as you see fit instead of relying on lawyers or courts.
No matter what your reason for wanting to sell your structured settlement, choosing this option puts you back in control of funds that is rightly yours. The problem that lots of individuals have with their structured settlements is that the control over their funds is left to lawyers, courts, and the company or persons paying out the settlement. You are now able to say where, how, and - most importantly - when you spend your funds.
· If you don’t plan to use the funds right away, but would put it in to a savings or funds market account to draw interest. This would be best suited for anyone who has a hefty settlement, can find an account with big payoff terms, and designs to keep the majority of the funds in the account for lots of years.
The Drawbacks of Selling Your Structured Settlement
For a few individuals, selling their structured settlement and receiving a lump sum payment may not be in their best interest. One must also assess these situations and decide if they outweigh the reasons you are considering selling your settlement.
· Because you may lose out on a substantial portion of your settlement by selling it, if you are in a financial situation where regular monthly payments will only be a bonus on top of what you already make, waiting out your settlement may be in your best interest. However, if you’re a senior, then you should also take your age and the length of your structured settlement in to consideration. This would be the ideal situation for anyone who is young that they have a great chance of living out the life of their settlement.
· First and foremost, selling you structured settlement means that you will get less funds than you would if you were to keep it. However, for lots of people considering this option, this seems like a win-win situation - they will get one big lump sum payment and the company they sold it to will make a profit in the finish. The nice news is that since you have several companies competing for your settlement, you can select the one that will give you the a portion of the full settlement that you can live with.
· For those reasons, you should also not consider selling your structured settlement if you have an addiction to gambling, shopping, or drugs.
· If you are a person who is poor at managing big sums of funds, then selling your structured settlement may not be right for you. For example, if you are the kind of person who gets a big paycheck every two weeks and finds themselves running low on available funds at the finish of those two weeks, then that may be an indication that needs to be closely looked at. In this type of circumstance, having your settlement portioned out to you on a monthly basis may keep you from spending it quickly. Once your settlement is gone, you will be back at square one.
Most individuals receiving a structured settlement can benefit from selling it to a company that can give them a big lump sum payment or shorten the life of the settlement, if they are older persons, an individual who has enormous expenses due to an accident or court case, anyone in a critical financial position, or one who wishes to make a big purchase for themselves and their relatives. Finding the right company with terms that fit your needs is a key component of making your experience with selling your structured settlement a positive one.
· If your settlement was due to an accident that has put you out of work and the funds from it will replace your monthly income, then keeping the payments on a monthly basis may help your relatives keep your finances in order. However, even in this situation selling your settlement may be best for you if you would like to renegotiate your payments in to a larger sum each month to shorten the life of the settlement.
David Springer is a consultant for Sovereign Funding Group. Sovereign Funding Group is an experienced, reputable company that offers convenient, no-risk services to help you with the selling of your structured settlement
Monday, 14 September 2009
Friday, 3 July 2009
Getting Cash Now for Your Structured Settlement
Perhaps you’d suffered personal injury in an auto or other accident, you were awarded damages in a product liability case, or you were the victim of medical malpractice or were even the plaintiff in a wrongful death suit. You agreed to a periodic (usually monthly) payment, maybe in the form of a lifetime income stream, that seemed to be the answer to paying your ongoing living expenses and perhaps your medical costs. You made the best decisions you could at the time, with the information you had – based on how life was then, and what you expected for the future.
If you’ve agreed to accept a structured settlement, it’s likely that you felt a sense of relief that your financial uncertainties were being resolved, and that you’d have the funds necessary to pay your bills, support your relatives and go on with your life. When you agreed to the terms of the settlement, hopefully with the help of a financial advisor, you accepted a series of financial payments that made sense for you at that time.
But life never works out as we expect. Maybe you’re on the road to recovery from the accident or other event for which you received the settlement, and need to move and buy a house, get married, go to school, or buy a business. Maybe medical bills or high interest debt is an undue burden on you that you need to resolve now. Or, if your relatives has grown, and your children no longer need for you to provide for their education or other expenses, you may need to spend more of the funds you have coming to you now, instead of later.
What can you do to match your finances – specifically your structured settlement – with the life you now have or need to have? You should always consult an attorney or a financial advisor, but here’s a basic overview of your rights and options in assigning your structured settlement:
Settlements are funded by single premium annuities, issued by insurance companies. Instead of paying you a lump sum amount, the party found responsible for injury or damages to you has paid a one-time lump sum to an insurance company, which has, in turn, invested it. The insurance company has projected the interest rate or securities dividends we will get on the lump sum, and based on the length of time and number of payments you chose or were offered for the structured settlement, we calculated the periodic payment amount you’re now receiving.
So who owns what? The insurance company owns the annuity, and you, as the beneficiary, are entitled to an income stream, or the series of periodic payments. Because you don’t own the underlying asset, the annuity, you therefore can’t sell the annuity contract to another party to get your money. However, under federal and state law you can, with court approval, sell all or a portion of the payments you are entitled to get in the future. In doing so, you can get a lump sum funds payout now.
How can you determine today’s lump sum value of your structured settlement payments? This depends, in part, on the amount of each payment and when it's due. The payment amount and schedule will be outlined in your Structured Settlement Agreement. it's also affected by the financial strength of the issuer of your annuity, because the better the financial position of the issuer, the more likely it's that the purchaser of your funds stream will be paid. The current financial climate, as well as interest rates will also affect your cash-out amount. Your financing company will explain these calculations and assumptions to you.
What are your options? As an annuitant, or the beneficiary of the structured settlement annuity, you are, in most instances, able to assign to a third party the payments you are entitled to get in the future. Some Structured Settlement Agreements state that payments cannot be assigned, and your legal counsel will advise you of options and alternatives if yours is written with such a clause. Fortunately, state laws and recent case law have rendered contracts written with such provisions unenforceable, although other regulations may apply.
- First, you need to take a hard look at whether receiving your funds now will truly be best for you and your relatives. This is a big financial step, not to be taken lightly. That said, your circumstances may have changed sufficiently so that a lump sum or partial payment in the form of a lump sum makes sense, and is better for your family’s current and future lifestyle and financial stability.
What steps do you need to take?
- Next, contact a reliable financing company that purchases structured settlement income streams. we can guide you through the routine and help you consider alternatives, such as the sale of a portion of your structured settlement income stream, if this best meets your needs.
- The financing company will assist you by hiring an attorney experienced in structured settlement assignments. The attorney will explain to the court your desire to change your settlement, and any changes in your life that have caused you to make this decision. Because the attorney will be petitioning for judicial approval, he will need to understand your current finances, obligations and desires.
- What can you expect now? one time you have selected a finance company and attorney, the courts will put you on the docket and hear your petition for receiving your funds in a lump sum. They’ll need details of the future payments due you, the proposed amount of the lump sum distribution, and any costs you will incur as a result of restructuring your settlement. Their basis for granting you an approval is satisfying themselves that the assignment of your payments to another party and receipt of current funds will be in your best interest and in the best interests of any dependents you may have.
- Having all your documentation and agreements, and furnishing them promptly to your advisors and potential funding sources is key to receiving a funds payout in the shortest possible time. Because court approval is required, the time from the initiation of the request to the final approval is typically 45-90 days. So, as with other large financial decisions, such as obtaining a mortgage or refinancing, it’s in your best interest to begin the routine with a little time to spare, before you feel a time crunch. You deserve an equitable deal, as quickly as is possible, not the deal you can make in the least amount of time.
- one time you’ve agreed on a lump sum amount with your finance company, and obtained court approval, you’ll get a wire transfer or a cashier’s check for your lump sum amount. You’ll now have the funds you need – right when you need it most.
If you’ve agreed to accept a structured settlement, it’s likely that you felt a sense of relief that your financial uncertainties were being resolved, and that you’d have the funds necessary to pay your bills, support your relatives and go on with your life. When you agreed to the terms of the settlement, hopefully with the help of a financial advisor, you accepted a series of financial payments that made sense for you at that time.
But life never works out as we expect. Maybe you’re on the road to recovery from the accident or other event for which you received the settlement, and need to move and buy a house, get married, go to school, or buy a business. Maybe medical bills or high interest debt is an undue burden on you that you need to resolve now. Or, if your relatives has grown, and your children no longer need for you to provide for their education or other expenses, you may need to spend more of the funds you have coming to you now, instead of later.
What can you do to match your finances – specifically your structured settlement – with the life you now have or need to have? You should always consult an attorney or a financial advisor, but here’s a basic overview of your rights and options in assigning your structured settlement:
Settlements are funded by single premium annuities, issued by insurance companies. Instead of paying you a lump sum amount, the party found responsible for injury or damages to you has paid a one-time lump sum to an insurance company, which has, in turn, invested it. The insurance company has projected the interest rate or securities dividends we will get on the lump sum, and based on the length of time and number of payments you chose or were offered for the structured settlement, we calculated the periodic payment amount you’re now receiving.
So who owns what? The insurance company owns the annuity, and you, as the beneficiary, are entitled to an income stream, or the series of periodic payments. Because you don’t own the underlying asset, the annuity, you therefore can’t sell the annuity contract to another party to get your money. However, under federal and state law you can, with court approval, sell all or a portion of the payments you are entitled to get in the future. In doing so, you can get a lump sum funds payout now.
How can you determine today’s lump sum value of your structured settlement payments? This depends, in part, on the amount of each payment and when it's due. The payment amount and schedule will be outlined in your Structured Settlement Agreement. it's also affected by the financial strength of the issuer of your annuity, because the better the financial position of the issuer, the more likely it's that the purchaser of your funds stream will be paid. The current financial climate, as well as interest rates will also affect your cash-out amount. Your financing company will explain these calculations and assumptions to you.
What are your options? As an annuitant, or the beneficiary of the structured settlement annuity, you are, in most instances, able to assign to a third party the payments you are entitled to get in the future. Some Structured Settlement Agreements state that payments cannot be assigned, and your legal counsel will advise you of options and alternatives if yours is written with such a clause. Fortunately, state laws and recent case law have rendered contracts written with such provisions unenforceable, although other regulations may apply.
- First, you need to take a hard look at whether receiving your funds now will truly be best for you and your relatives. This is a big financial step, not to be taken lightly. That said, your circumstances may have changed sufficiently so that a lump sum or partial payment in the form of a lump sum makes sense, and is better for your family’s current and future lifestyle and financial stability.
What steps do you need to take?
- Next, contact a reliable financing company that purchases structured settlement income streams. we can guide you through the routine and help you consider alternatives, such as the sale of a portion of your structured settlement income stream, if this best meets your needs.
- The financing company will assist you by hiring an attorney experienced in structured settlement assignments. The attorney will explain to the court your desire to change your settlement, and any changes in your life that have caused you to make this decision. Because the attorney will be petitioning for judicial approval, he will need to understand your current finances, obligations and desires.
- What can you expect now? one time you have selected a finance company and attorney, the courts will put you on the docket and hear your petition for receiving your funds in a lump sum. They’ll need details of the future payments due you, the proposed amount of the lump sum distribution, and any costs you will incur as a result of restructuring your settlement. Their basis for granting you an approval is satisfying themselves that the assignment of your payments to another party and receipt of current funds will be in your best interest and in the best interests of any dependents you may have.
- Having all your documentation and agreements, and furnishing them promptly to your advisors and potential funding sources is key to receiving a funds payout in the shortest possible time. Because court approval is required, the time from the initiation of the request to the final approval is typically 45-90 days. So, as with other large financial decisions, such as obtaining a mortgage or refinancing, it’s in your best interest to begin the routine with a little time to spare, before you feel a time crunch. You deserve an equitable deal, as quickly as is possible, not the deal you can make in the least amount of time.
- one time you’ve agreed on a lump sum amount with your finance company, and obtained court approval, you’ll get a wire transfer or a cashier’s check for your lump sum amount. You’ll now have the funds you need – right when you need it most.
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