How Do I Get Cash For A Structured Settlement

If you are the beneficiary of a structured settlement as the result of a personal injury, medical malpractice, or workers' compensation case, you may have seen ads that promise "cash for your structured settlement", and be wondering if you should cash out.

Even if you really need the money, you should carefully examine your options, and try to determine if selling your settlment is truly in your best interest.
Promises of Cash Payment for your Structured Settlement

A growing number of companies offer "fast cash" or "cash payment" for structured settlements. You should try to make sure that the company you choose to work with is on sound financial footing, such that you are not at risk for default on your promised cash payment after you sign over your annuities.

You should also make sure that your company is competent and ethical, and won't try to come back at you if they later have problems obtaining your settlement payments after you are cashed out.
Before You Enter Into a Structured Settlement

Not all plaintiffs have the luxury of choosing whether part or all of their settlement will be structured. For example, a number of states require that certain future damages awards be paid in installments as opposed to in a lump sum, or permit a defendant to petition the court to pay future damages in installments.

However, where a plaintiff can choose between a structured settlement or lump sum payment, care should be taken to make the correct choice.

Benefits of a structured settlement include possible tax avoidance, preservation of settlement funds for future care and future needs, and coordination of settlement proceeds with other benefits or public assistance.

Disadvantages of a structured settlement include possibly not having the available funds to make necessary purchases, or even desirable discretionary purchases, high commissions on the purchase of annuities, and a low yield as compared to other investment options.

Also, if payments are equal, each payment will actually be reduced in real value as compared to the prior payment due to the effect of inflation.
Considerations Before Selling Your Settlement

Factors which should be taken into consideration before selling a structured settlement include:

Legal Restrictions - Due to the nature of some settlements, there may be legal restrictions on their sale.

Contractual Restrictions - Some structured settlements and annuities are set up in a manner which makes it difficult to impossible to sell them.

Tax Considerations - A structured settlement may offer considerable tax savings to an injured plaintiff, whereas a cash payment may subject the plaintiff to a significant, immediate tax liability.

Low Offers - Sometimes a buyer of structured settlements will make an unreasonably low offer for the settlement.

These factors are outlined in greater detail in this associated article, "Selling Your Structured Settlement".
Can a Lawyer or Accountant Help

While a lawyer may not be able to help you decide if you should sell your settlement, a lawyer or financial professional can help you figure out the short- and long-term financial consequences of selling your settlement.

They may also be able to help you determine a reasonable selling price for the settlement. A lawyer can also review a proposed contract for the sale of your structured settlement to make sure that you are adequately protected in the event of future complications.

Depending upon your circumstances, you may require a court to approve the sale of your structured settlement, and a lawyer may be able to assist you with that process.

The skinny on getting cash for a structured settlement payment

Very often, individuals who receive a structured settlement do not wish to wait for years to obtain the cash and would rather have it all in one go. Settlement purchasing companies help people to get cash instantly; the cash can be obtained at any stage of the execution of the structured settlement.

A person who receives the lump sum is free to use it any way he desires – for education, home, or car.

It is not uncommon for a recipient of a structured settlement to run into a financial difficulty or come across an investment opportunity that promises better returns than a structured settlement.

At such times, individuals consider getting cash for their structured settlement and use the money to build their own portfolio of investments. An advantage of getting lump sum cash is that it acts as a hedge against inflation.

Companies that purchase annuities do so at a discounted rate, at the very minimum, the discount is equal to the existing bank rates. Sometimes, purchasers may require a higher discount in order to cover the risk involved and make a profit.

One should ideally take the help of a financial advisor who can professionally assess an individual’s income, assets, and monetary obligations. This helps to put into perspective future security as assured by a structured settlement against a lump sum payment.

Companies that purchase structured settlements offer to do so in a number of ways so that an individual can sell different amounts of an annuity. The flexible plans can be tailored according to an individual’s requirements; this allows one to enjoy both a lump sum at hand for immediate needs and regular payments from the annuity.

The course of action to be taken while selling a structured settlement depends upon the immediate needs that could include paying off debts, child’s college fees, debt consolidation, or a business venture. Cash for structured settlements can be obtained as a full payment, partial payment, or a shared payment.

A full payment involves receipt of a lump sum for the entire annuity. It is an option when high debts have to be repaid. While selling an annuity that is due well into the future, one should be careful because they do not result in as much money as those annuities that are due sooner. This is because the value of money depreciates due to inflation.

Partial payments can be useful if a limited amount of money is required for consolidating debts or repaying a loan. A given number of payments can be sold off for a lump sum in a partial payment. With a shared payment, one can sell of a portion of a lump sum that is due in a short time.

A shared payment enables one to pay off expenses that are going to be incurred in the near future; these may include education fees or the cost of a new vehicle.

Individuals who intend to obtain cash for their structured settlements should obtain the necessary court approvals for the purpose.

One should ensure that the transaction complies with state and federal restrictions. Before deciding upon a buyer, one should research a few companies and look out for the best deal possible. It is also important to check the credentials of a prospective purchaser.

Cash for Structured Settlements

Do you need cash now for your legal settlement before the case actually settles? Advanced funding was created out of an understanding of the financial strains clients are under during the course of litigation. Often clients are out of work or rehabilitating an injury during these cases, and find themselves without enough money to live. Watching the bills pile up further strains their already stressful situation.

Advance funding helps ease the financial burden by providing cash when it is needed most: prior to a settlement. Cash flow factoring companies can help clients with many types of cases including auto accidents, personal injury, medical malpractice, wrongful death, and worker's compensation.

Sell Structured Settlements
Structured settlements are arranged payments from insurance settlements, personal injury settlements, and many others. These structured settlement payments provide steady, consistent payments which are paid over a period of time.

For some, the guaranteed future income stream of a structured settlement can be an ideal form of financial security. However, for many, their financial picture changes due to unexpected expenses or financial opportunities that require cash now. Advance funding was created precisely for this situation: to allow you to sell your structured settlement for cash now.

Structured settlements only represent one form of advance funding, however, cash flow factoring companies can also help you get cash now for your annuity, lottery payments, or even by selling your life insurance settlement.