Selling Structured Settlements
Yes, there are ways of selling your structured settlements, if you are having second thoughts about them or do not have the time and energy to wait it out. All you have to do is make sure that you are going through a genuine company when you are getting this done. If you are using an agent for selling structured settlements, make sure that the agent is affiliated with a reputed company, so that would reduce the chances of getting in trouble. Further, if he thinks of doing anything suspicious, you would be able to catch him in the act by going to the company and informing on him.
Before going any further, we should clarify what structured settlements are, raising the question:
What is a structured settlement?
Usually making an appearance when you have an accident or an injury, a structured settlement is an amount, technically speaking a bunch of amounts that you would receive as settlements from an insurance company, when you have been wronged. The way this works is, if you have an injury and the insurance company owes you some money, they would have to pay you the settlement amount. However, companies sometimes choose to pay in smaller amounts over time so you do not get your hands on a lump sum, this would be beneficial to you since you would not have the need to go on a crazy spending spree and you would get interest on the amounts that you are getting in the long haul.
Structured settlements have been around for some time now and they are usually beneficial to people who have smaller payments they would need to make. It can help you with medical payments or smaller changes that you can begin making around your house. Unlike if you ended up with the lump sum and spent it on getting yourself a fancy sports car or something.
What happens if I want out of a structured settlement?
It is not easy handling getting out of one since all of the rules of the structured settlement are made before the settlement begins. This means that you would have everything from the amount you would be receiving, to the how many times in a year, whether it is a yearly, half yearly, or other terms and the percentage of the interest that you would receive.
After this is signed and agreed upon, it is very difficult to get out of it and that means you would have to run and little and handle a lot of manual work to get this undone. Further, being the type of payment that it is, there would also be a court involved and that would make things a little more complex.
As mentioned above, there are a bunch of companies who would be willing to purchase the settlement. If you Google a list of these companies and go through their reviews, you would easily find one that you could work with and surprisingly would even find people who you know who went through this in the past.
You might feel that it is your money and you should be able to take the entire amount whenever you want it but there are a few things that you have to remember:
- You are more likely to spend larger amounts of money when you have it in your hands as opposed to if you are getting smaller amounts
- You would be generating interest if you kept the money in the bank as opposed to if you asked for everything in one go.
- Better for handling your basic expenses instead of having to deal with paper work and handling of larger amounts in your bank account.
Can you elaborate the process of selling a structured settlement?
It is not something that you can get done easily, you would have to get a bunch of paper work handled. Finding the right papers and getting everything signed and submitted. After you get all of this done, you will have to wait for about 45 days for everything to get processed.
You have to realize that laws vary across the state that you are applying from, that means you would not be able to put a time down and call that the rule. Further, you have to find out if the company is giving you a cheque for the amount, or if it is going to be wired to your account directly. If it the latter, that should save you some time when it comes to getting the money.
Another thing that has to be mentioned is the amount that you would have to pay as a surrender charge before you sell the structured settlement. Sometimes the amount you are paying as a surrender charge is so large that it would make you change your mind about the payment altogether.
What if I need the money but I do not want to sell my structured settlement?
We would personally advise anyone against selling their structured settlement since it is always an investment that will always benefit you in future. We would however tell you to look for other options only if you really needed the money, otherwise to just wait it out.
An example of an emergency where you would really need the money, would be a medical emergency and where for obvious reasons, you cannot wait it out.
If you need the funding and waiting on your structured settlement payments is not cutting it, your other alternatives would be taking a lone on the settlement payment. This means that you would be putting the structured settlement up as collateral. You have to realize that in the long run, this means you would have to pay more for the overall payment, since you would be working with the settlement amount that you would have taken the loan on and you would have to pay the interest on that as well. More often than not, the interest of the loan on the settlement would be higher than the interest that you would be getting off the settlement directly.
Well there you have it, all you need to know about selling structured settlements and then some more, with a few of our thoughts on the same.