How to Purchase Structured Settlements

People who get large insurance claims after an accident often receive structured settlements. A structured settlement is a payment that is made either annually or semi-annually to an individual. These settlements are usually structured to help the person deal with ongoing medical expenses that may occur. People who own settlements can choose to sell it if they wish. In order to purchase a structured settlement, the company who issued the settlement must allow them to be sold.

People who are looking to cash in on their structured settlement are seeking a lump sum payment. This lump sum payment is in exchange for the ongoing structured payments that the party is receiving. These settlements are popular to buy because they are guaranteed income at the certain interest rate. The only risk in having a settlement is the risk that the company issuing the settlement declares bankruptcy.

When people are selling their settlements, they do not receive the full value of the actual settlement. They get immediate cash, but aren't paid the full value of the settlement. This means that the buyer of the settlement does gain some return on their investment.

There are many reasons why someone would want to sell their structured settlement. The biggest reason would probably be a need for instant money. Many people go through times in their lives where they need some immediate cash. Because structured payments are set up annually, many people choose to encash their settlement for an instant payout. The person purchasing structured settlement pays out a lump sum for the holder. They receive the benefit of having a secured investment for the remaining period.

How To Buy Structured Settlements Correctly

The market includes lots of companies, which are specialized to buy structured settlements. They have the expertise and they will connect the sellers and the buyers. Because the sellers are all over the country, they advertise their services in mass media, in TV for example.

When somebody will buy structured settlements he will do the purchase from the market. The settlements belong to the financial products, meaning alternatives to invest money or to plan a financial future. It is important to note, that despite of the fact, that a recipient may have got the settlement policy as an injury victim, the buying and selling these products is tough business.

1. Be Careful With The Scams.

Every single market includes scam companies with the only target to cheat money from private people. So does the structured settlement market. This fact is useful to keep in mind and to concentrate to make sure the candidate companies are legal enterprises.

2. How To Pick The Legitimate And Reputable Company?

One feature, which a reputable company has is, that many people have done cooperation with it. The brand image is known and the name is popular inside the industry. When a person plans to buy structured settlements, the first step is to create a short list about the reputable company names. Your bank manager can give good tips.

3. How Much You Will Get?

The companies, which buy structured settlements do not pay the face value for them. A rough example is, that if you have a settlement with a value of $ 500.000, which will be payable during many years, you will probably get $ 400.000. You can try to increase the sum by trying to sell the policy in pieces to different buyers.

4. The Influence Of The Taxes.

When a recipient gets periodic payments from the settlements, they are tax free. But when he sells the policy, he has to pay the taxes from the selling price. To the buyer the purchase is naturally tax free. It is wise to talk about the taxes with an expert to make sure, you have the right idea about them.

5. The Correct Information Is Required.

When you have a cooperation with a reputable company or lawyer firm, they can help you a lot. But it is also wise not to trust too much on them, because they want to benefit. A seller needs his or her own information to be able to pick the right companions and to be able to select the right alternatives.

Frequently Asked Questions - Settlement Loans

Q. "What is the interest on a settlement loan?"

A. If it were a loan, you would have to pay a loan back no matter what. However, these are non-recourse advances. This means that, if you lose your case, the lender loses money. The lenders to which applications are submitted are not providing loans. Therefore, the lenders don't charge interest. In lieu of that, lenders charge a risk-fee. Risk-fees are determined on a case-by-case basis. If your case is approved for settlement funding, the contract will state exactly what will be owed before you sign anything.

Q. "What is the length of time required to obtain a loan settlement?"

A. It depends on your attorney. The broker will send a request for documents to your attorney, and must speak with your attorney as soon as possible. If the required information is obtained and the broker is able to talk to your attorney within one day, you may receive your settlement loan that same day. Therefore, you should notify your attorney that you're pursuing a loan settlement and that your attorney should supply all requested information to your broker as quickly as possible.

Q. "Do I have to pay for any thing up front?"

A. No up-front costs are required.

Q. "What is required for me to obtain the requested lawsuit loan?"

A. At your election, you may have the lender FedEx a check to you overnight. Furthermore, if you wish, the lender can wire the money directly into your checking account. If you opt for the latter, there will be a pre-determined fee.

Q. "What must I do to keep from providing either my date of birth or Social Security number prior to obtaining a lawsuit loan?"

A. No. This will not be necessary prior to issuing the lawsuit loan. However, once you are approved, you must provide that information prior to release of the lawsuit loan.

As you are aware, time is of the essence! Therefore, a good broker will follow up immediately with you via a phone call to ensure that the law firm with which you want the broker to communicate has received the document-request.

It is rare that attorneys themselves either prepare or submit the paperwork in response to a lawsuit loan request. Rather, it is customary for either a paralegal or secretary to both prepare and submit the paperwork to you.

Brokers must quickly establish contact in order to obtain the requisite documentation. If your broker is diligent, and if the paperwork is not received within 1-2 days, the broker will follow up with the law firm and request documents once again.

If your attorney fails to cooperate with your broker, the broker will ask that you assist in obtaining the requisite documentation. It should be borne in mind that the attorney works for you. The clock is ticking! You want to obtain your settlement loan today, not next month!

A good broker will never suggest that you retain a new attorney, even if you have a particularly uncooperative attorney. However, without your attorney's cooperation, you will be unable to obtain the lawsuit loan. To obtain the settlement loan both your cooperation and your attorney's cooperation will be essential!

If your attorney requires a signed Release of Medical Records prior to releasing medical records to your broker, your broker will obtain the requisite form, submit it to you, and request that you sign it and return it to your broker as quickly as possible.

Ideally, your attorney will submit the documents following the initial contact. Once the documents are received, the broker must review the documents received to determine which broker may be most appropriate for your lawsuit loan request. Once that information is obtained, a competent broker will select a funding-source most applicable to obtain your pre-settlement loan.

Debt Settlement Vs Debt Consolidation - What's the Difference What's Right For You

Credit card debt can become a very severe problem in your life. The best way to use a Credit card is to make regular and timely payments. Defaulting on payments or making minimum payments only for prolonged period of time can gradually build up your debt. Once the debt has made a beginning in your account it will stay till such time you make concerted efforts to clear it.

There are many ways of seeking debt relief. You need to find the solution that is best for you and meets your repayment plans. By the way did you ever have a repayment plan. Not having a proper plan to pay back your debt can land you in severe trouble. Debt consolidation and debt settlement are two good plans to clear your debt. Let us take a look at both the methods. A debt consolidation plan aims at putting all your debt under one basket. You can either go in for a balance transfer to the Credit card with the least rate of interest or go in for a consolidation loan. Unsecured Debt under all types of Credit cards is put under one head. You can clear it off in one go using the consolidation loan. The consolidation loan is then paid back in easy installments. The point to note is you will still be in debt till such time the consolidation loan is not paid back.

The other tool available for debt relief is debt settlement. Here you go in for negotiating your debt with the Creditors. The Creditors are also under trouble and are worried about most of their debtors filing for bankruptcy. Should that happen the Credit card companies will be in deep trouble. They want to avoid this situation. Therefore they are willing to negotiate the outstanding amount for consumers having a debt of more than $10,000. They may waive even 50 percent of the net outstanding if you negotiate well. The other half has to be paid by you in a lump sum payment. Debt settlement is the only form of debt relief where you can legally eliminate debt without paying it back in full.

Credit Card Debt Fighters - Do You Think You Can Negotiate a Debt Settlement

Though it might sound cliche but there is this smart ass comment which says that there is nothing like impossible because the word -impossible- itself says that I'm possible.

Where as this is also human nature; which is very well elaborated further by this German philosopher, according to whom "what does not kills you makes you stronger". It is a trait that is by default inculcated into the human's nature which makes them stubborn about things that are challenging though this stubbornness sometimes pays off but at times it also leads to a complete disaster; where one starts thinking that I wish I wouldn't have started this in the first place.

The same is the case that is also witnessed with those people who want to fight their case of credit card debt but this is not something which one should be really doing; especially when we are talking about a balance due more than five figures. It would be better of to leave it to those whose job it is and imagine all the technical or monetary wheeling dealing you have to do with creditors; so considering all these aspects rather than going at it by yourself, it would be better to drop the idea and let the professionals deal with it.

There are numerous attorneys or Debt Settlement firms that provide services in this regard who apart from facilitating the whole process of your Debt Relief also provide a legal cover against the collection agencies and the creditors as well. Therefore it is highly recommended to render the service of any professional and dedicated Debt Settlement firm because they for sure know their job and they can also turn things around for you; consider the emotional and financial stress you've to go through when you know that with every passing day the debt is increasing and in such a situation how can you efficiently handle such a delicate matter.

Apart from that the creditors above every thing else have only one thing on their mind i.e. getting their money back and they can go to any level for that, therefore the wise thing to do for avoiding embarrassment and further stress it is recommended to turn towards a Debt Settlement firm who can profess your case in a better manner.

Cash For Structured Settlement Payment

There are companies that specialize in getting you cash for structured settlement payment or annuity payment plans that you may have. If you have been involved in a personal injury lawsuit, you may have reached a settlement agreement that brings you a large award, but doles it out in smaller amounts over time. This means you receive a guaranteed income of those amounts each month or year, until the full amount has been paid. Some settlements even result in payments for a lifetime, which can be a lot of money.

The purpose of the structured sum is to benefit the recipient by assuring they have money income on a regular basis, for a certain period of time set out in the mediation meetings where the settlement was reached. Some settlements are structured even for small amounts, over time. There are certain tax advantages that may occur if you take the settlement over a long period of time, rather than in one big lump sum, so you end up with more cash in the long run.

Still, there are circumstances that arise that make you wish that you had taken the lump sum. It is never too late, because there are companies who can give you, in effect, a cash advance on your future settlement income. They buy out all or part of your settlement, and you get cash now. They do charge a fee, in the neighborhood of ten to thirty percent. They take on the risks of possible future inflation that will make the money worth less than now, and they advance you cash now. It is a bit like a payday cash advance loan, but for a lot larger sum of money.

Since the settlement is a legal agreement, in many states it is necessary to get a judge to approve any changes, or cash advances against the settlement. This is for your protection, to see that this action is in your best interest in the protective eyes of the court system. If someone has large, ongoing medical expenses, it may not be the best thing to do. If you want a down payment to buy a home, it may be a good thing to do.

If you take a full lump sum of cash for your structured settlement payments, you are responsible for using that money wisely, and in your interest, because you will no longer have that guaranteed income to rely upon. Getting cash for structured settlement payment or annuity payment plans can be a real help. However, be sure to check around for the best deal, and the most reliable advance company, before you do anything. It never hurts to be extra careful with money.

An Annuity - Is It For Me

Annuities have been getting a lot of scrutiny in the press lately. Financial advisors and insurance agents are receiving a lot of these complaints. There are so many options when it comes to annuities that people tend to trust salesmen a little too much without doing their homework first. There are several different types of annuities and all of which have different variables on rate of return, tax consequences, and payout. The following will give an overall summary of the various types of annuities and the pros and cons of each.

First, an annuity is a contract between a client and the insurance company. This agreement is to supply income for a specified period of time or for a lifetime of an individual. The annuity can be purchased using a single lump-sum payment or smaller incremental payments. The income benefit for the annuity can be immediate or can be deferred until retirement. The main purpose of this vehicle is to create a self pension and provide an income long term.

One of the main problems in society today is the fact that people are living longer and creating the chance of outliving their assets. This will be an ongoing problem in the next 20+ years when it is believed that social security may dwindle away. Another large problem is that companies are moving further away from pensions and moving more towards 401K's and IRA's. This is giving more of the retirement investing to the employee and taking the burden off of the employer.

There are several different types of annuity contracts; there are immediate annuities, fixed annuities, indexed annuities, and variable annuities. Immediate annuities are the one financial product that can allow you to liquidate your principal yet be guaranteed not to run out of cash flow, no matter how long you live. This is because insurance companies pool the longevity risk across a large number of annuity owners, ensuring that there is adequate money to pay those who live a long time.

Fixed annuities are comparable to bank CD's and offer a fixed percentage of return often much higher than interest rates of bank CD's. Indexed annuities are designed to have a safety of principal similar to CD's, money market funds, and savings accounts. They are often linked to an index and guarantee a minimum rate of return but put a ceiling on a maximum. Variable annuities allow investors to allocate their money into the stock market through mutual funds with an insurance wrapper on it. It allows people to pay more fees for the insurance on the principle but allows them to participate in some of the excitement of the stock market.

Variable annuities are similar to many types of retirement accounts. They offer the benefit of tax deferred growth which is similar to IRA's and other retirement accounts. There are two different tax consequences based on the type of money used for the product. There are qualified accounts which are taxed similarly to 401K's and IRA's and there are non-qualified accounts which are taxed similarly to Roth IRA's and mutual funds. Withdrawals from deferred annuities are taxed on an interest-first basis, and subject to a 10% early withdrawal penalty when taken prior to age 59 1/2. Withdraws from a qualified account must begin before 70 1/2.

There are several options or "riders" that an individual can put on his policy to make it a more attractive investment. One of the more popular additions is the Guaranteed Minimum Income Benefit (GMIB) rider. This puts a floor to the amount of money an investor can make so that it will not dip into the principal if the stock market is performing poorly while allowing for the investor to capture an upswing in the market. An example would be a minimum of 5% with no maximum that could be achieved. So if the market went down 20% the worst an investor can do is a positive 5%. Another popular rider is a Guaranteed Minimum Withdraw Benefit (GMWB). This benefit allows the owner of the contract to take withdrawals for a guaranteed minimum period of time. This type of benefit guarantees you your money back unless you have positive investment results.

There are several negatives to annuity contracts as well. There are surrender periods that lock in the investment for a specified period of time. An annuity is not a liquid investment. In addition to that one of the risks that an investor takes is mortality risk. This is a risk an owner takes by signing certain annuity contracts. This means that the client may deposit $100,000 to get paid an income for 10 years and they die prior to 10 years. The money invested in certain contracts is forfeited.

Annuities are a good investment but it depends on if it is applicable to an investor's situation and risk tolerance. It is a long term investment that has relatively high fees, a period of surrender that must be satisfied, and not always a good return on investment. It allows for tax deferred growth, a minimum benefit with certain riders, and security allowing an investor to not outlive their assets.