Do you have a Structured Settlement and Need Money?

A lot of people go through a legal case and end up getting what is known as a structured settlement. In the beginning you are able to choice from a lot of different options but many people end up with the monthly payments of an extended period of time. Those payments are known has structured settlement or annuity payments.

What happens it that usually the company that has to pay the settlement will set up some type of annuity with an insurance company that is set up in your name so that monthly payments will be paid to you over the time period that will pay you out the amount you were awarded.

The Process of Getting a Lump Sum Of Cash for Your Payment

When you are getting monthly payments it is easy to think that this is a great source of income and really it is. The problem however comes when you need a lump sum of cash immediately and you are stuck with the lower monthly payments. If you want to get a lump sum payment you will now have to sell some or all of your settlement to get the cash you need.

Are there any problems with this? The fact is that there are many ways to look at the situation and it really just depends on what the situation is for you. On the one hand you will sell the payments and get the money you need for whatever it is you need the cash for. So you get the money you need and you have taken care of what you needed.

On the other hand you have now cancelled your guaranteed source of income for over the next few months or years. On top of that you will never get the amount of cash for your settlement as it is worth. If you have a settlement for $100,000 and you sold it all you would probably only get $40-50K after fees. This is because the time value of money.

Should you Sell Your Payments For a Lump Sum?

Again this is really up to the individual. Are you in the processing of losing your home or have a medical expense that really needs to be paid? Can you afford to just sell some of your payments and not all? You have to be careful of low offers and make sure you get quotes from the structured settlement buyers out there. There are a lot of companies that buy payments from people and you need to consider the taxes, legal limitations in many cases seek an attorney to make sure your best interest are put forward.