Structured settlements have gained a foothold as an efficient mechanism of devolving enormous amounts of money to tort victims and lottery winners. The structured settlement is an arrangement between the claimant and defendant’s insurance company absolving the wrong-doer from liabilities in return for a future income stream guaranteed by the insurer. The insurer usually buys an annuity package from a top-class life insurance company to make those payments to the plaintiff. The structure of periodic payments creates room for the annuitant to make informed financial decisions and avoid wastage of lump-sum cashout.
Until 2005, I was unfamiliar with a structured settlement, but things took a different course after my husband died in a catastrophic workplace accident. The building contractor had provided tenuous safety belts to him while he was erecting steel in a new facility. Oblivious to the danger, the belt was torn causing him to fall 30 meters to his death. Rather than plunge into a legal tussle, I settled for a structured settlement after my attorney hinted the funds embedded within the plan would not be prone to federal income tax. Proponents tout it as an incentive for tort victims to invest the proceeds of the lawsuit instead of dissipating a lump sum award and fall back on public assistance. I had received monthly installments and annuities until I fell behind my mortgage payments prompting me to sell a share of the structured settlement fund pool.
Sell Structured Settlement-All You Need to Know
With the structured settlement market bristling with dozens of companies, you can always narrow down a lucrative discount, speedy processing, and minimal expenses. To convert total or a portion of your annuities and cash flows, you have to comply with the legal requirements. However, a reliable structured settlement purchasing company undertakes everything set in the Structured Settlement Protection Act such as disclosures, drafting and execution of a valid agreement and court approval.
Factors to Consider Before Decide to Sell Your Structured Settlement
- Time Value of Money and Discount Rate
Even economists and accountants still grapple with the so-called concept of time value of money, the formula for assessing the discount rate. I sought to familiarize myself with the concepts as they determine the lump-sum payable and intimate the viability of a factoring transaction. The future value of money amasses the annuity payments recoverable, and the present value works out the worth of your futuristic money in today’s currency but at a fixed discount rate. The discount rate refers to an interest rate related to the future income stream estimating the current value.
- The “Best Interest” for Payee Test
To understand the phrase, I had to wait until the court scrutinized the transaction. In my case, I was grilled by the judge before he could approve seeking to know my plans for the proceeds of the sale. Afterward, the court granted my application as I canvassed an impending foreclosure and lack of employment. The discount charged was found to be fair and reasonable in the circumstances.
- Cross-Shopping Offers for Your Assignable Cash Flows
List down the amount and future income stream you want to assign and use online free quote generators on the websites of structured settlement annuity purchasers. I found that prices and lump-sum payment offered by each company varied significantly, I recommend annuitants to compare various prices to rake in the highest amount.
- Sell Once to Scale Back the Costs of Selling Your Structured Settlement Payments
You can appear in court seeking approval to sell your structured settlement multiple times. But avoid double expenses and time expended in each round by selling the whole pot or large chunk of the fund. I considered the future and current demands, the mortgage took a significant share, but I topped off with additional bucks to avoid legal fees and expenses in another transaction.
Best Structured Settlement Buying Companies in the US
SenecaOne offers lump-sum cash outs for your structured annuity and unlocks a fixed financial package to effectuate your investment ideas with the most lucrative price and 100% guarantee of speedy disbursement after court approval.
Olive Branch Funding has a responsive customer support to assess your structured settlement payments by reviewing your kitty, circumstances and chances of success in court. The company has a vast pool of lawyers to craft a personalized agreement, pore over paperwork and comply with all laws and judge-made orders.
Fairfield Funding offers mouth-watering upfront cash advanced scalable from your lump-sum pending the court-approved transfer of your structured settlement annuity.…