Settlements increased in popularity when Congress passed the Periodic Payment Settlement act. The legislation encouraged the use of structured settlements in personal injury cases by offering significant tax exemptions for money received in a structured settlement.
Structured settlements are a type of annuity, which means the money is managed through an insurance company. The installments from the annuity issuing insurance company were exempted not only from federal income tax, but state and local income taxes as well.
A key part of choosing a buyer for your annuity is how much they offer to pay you for the right to receive your future payments. Getting a quote is free and can easily be handled over the phone. When you sell your annuity, it is subject to a discount rate, or the amount you are willing to discount your total annuity worth by in order to get cash now.
Selling a structured settlement is a legal process a judge must approve. If the client chooses to move forward with the sale, their application paperwork will be used to file a claim in their state court. CBC Settlement Funding uses a seasoned legal team to make this process as easy as possible, explaining the court proceedings along the way. If you choose to have an attorney represent you during these proceedings, our lawyers will also happily coordinate with your attorney.
After a judge approves the sale, the buyer will pay the client the agreed amount up front in exchange for receiving their future structured settlement payments. CBC Settlement Funding uses checks or electronic transfer to complete this process. We also offer small cash advances to our clients at the beginning of this process for immediate access to funds.
A structured settlement is often the result of a personal injury lawsuit in which the plaintiff (the party injured) receives periodic payments as a compensation for the injuries sustained in an accident. This income (usually occurring monthly) comes through what is generally known as an annuity. However, some do not consider a long-term stream of payments as beneficial as compared to a one lump sum payment would be.
Getting Cash for Structured Settlements or Annuities Makes Sense
When structured settlement companies compete for your business, you win. You wouldn’t auction a classic car to the first person to make an offer and you shouldn’t sell annuities to the first company you call. We get you the most cash for structured settlements by creating a marketplace where multiple companies make you competitive offers for all or a portion of your annuity payments or structured settlement.
Sometimes, a recipient of a structured settlement will seek out a buyer to purchase all or a portion of their payments. A structured settlement company, sometimes called a factoring company, then pays the consumer a discounted lump sum in exchange. This system can benefit the consumer by allowing access to money up front, and can also benefit the company that purchases the settlement at a discount. Because some predatory companies take advantage of less knowledgeable consumers, it is important to know what to look for when choosing a settlement company.
When you sell your structured settlement for cash, you basically sign over the right for someone else to receive your payments. That person then pays you a lump sum for the right. However, you will not get the entire amount that the annuity is worth. Instead, it is discounted. But if you are in need of a large sum of cash rather quickly, selling your annuity can help ease your current situation. It is also worth noting that you do not have to sell your entire settlement. It is possible to sell only half, or a quarter, of your settlement.
Before you sell your structured settlement, however, it is important to understand the state laws. While most states will allow you to sell your structured settlement annuity for cash to a third party, some do not. Find out the restrictions in your state before you decide on whom to sell your structured settlement to. Also, be aware that in some states court approval is required before you can sell your structured settlement. The buyer may further deduct court fees from the lump sum you are paid.
HOW TO FIND THE BUYERS
The new way to find structured settlement buyers certainly beats the old one. All you have to do now is visit a website like StructuredSettlement-Quotes.com and fill out the forms to provide information about your structured settlement. Once you provide some details about the remaining payments and the value of your structured settlement, they will be able to get you some great quotes on offers to buy it from you for a lump sum of money. When buyers compete with each other to put in the best bid, it benefits you greatly.
You’ll also need to provide some contact information so that they can get a hold of you. Once you are provided with the details on the offers, you’ll have some time to decide whether or not you want to accept one of the offers and sell your structured settlement.
The point is that the structured settlement can be sold for quick cash. Of course you will not get the same amount of money as if you had received all of the payments. If you want anybody to consider buying your settlement, you have to realize that you have to offer it at a substantial discount. This is to entice a buyer, because keep in mind that somebody is going to invest in your settlement so that they can get the income from it.
When a person, or company, buys your structured settlement, they assume all of the risk of collecting the future payments. If the company that makes the annuity payments goes out of business, it is a big loss for the investor that bought your settlement. What you have to consider is the opportunity a large sum of cash can give you. Now if you burn through the lump sum, you will be most devastated, so be very cautious.