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Making the decision to sell annuity payments from a structured settlement is a big one. There are no structured settlement loans; when you cash out a settlement you are selling off your rights to future payments. You may understand by now that there is more to this decision than you initially realized. So, let us break it down. Following are the four most important things that you must know before you sell your structured settlement payments.
As famous financial adviser Suze Orman wrote, structured settlements provide a continuous income stream that ensures one does not overspend and make poor financial decisions; using a structured settlement wisely can improve one’s financial security. But sometimes using structured settlement money wisely might mean selling your payments – you must decide.
Likely the biggest, most important tip – the one thing to take from this guide if you remember nothing else – is to only sell part of your payments, if you can. Sell only the number of payments that you absolutely must in order to meet your immediate financial need. If you need more money in the future you can always sell more payments.
Some people ask about getting a loan against their structured settlement, but there are no such things as structured settlement loans. When you cash out a settlement you are not getting a loan against it, you are selling the remaining payments.
Sometimes the buyer will offer to service your sale payments. This means that they will take control of all your payments, and then send you your share. But what if they go out of business? Buyer of structured settlements J.G. Wentworth filed for Chapter 11 bankruptcy and had to reorganize – if that happened to a company that was buying your payments and acting as servicer you could lose your unsold payments. Ensure that you have a separate servicer and that the company buying your payments pays any applicable fees.
Since this is such an important point it bears repeating: A structured settlement is an excellent investment for the future, and for most people the payments are a better choice than a lump sum of cash. Do not sell your payments lightly and sell only as many as you really have to in order to meet your immediate financial needs.
When you sell personal injury annuities structured settlement payments stop coming; once you receive your structured settlement buy-out check there is no going back. You can’t change your mind. A few states, such as New York, have a required waiting period between the court approval and the actual receipt of money to allow you time to think things through and change your mind, but most states do not. And, unlike with some large purchases, there is no right to rescind – so you can’t just change your mind a few days after you get the money and get your payments back. You can stop the sale any time before court approval. But once the payments have been transferred to the purchaser that is the end. So be sure to make your decision wisely, as it is final. Strategic Capital can help you to think it through and ensure that this is the best decision for your family; call Strategic Capital today.