Sell my Structured Settlement – Structured settlement is an insurance or financial arrangement where a claimant agrees to resolve a claim of personal injury tort by receiving payments periodically over an agreed period rather than as a lump sum. If you think “Should I sell my structured settlement?” – Well this is not a hard thing to do but it involves various decisions such as how much I want sell, taking step to sell actually sell it, and going before a judge to request approval prior to accessing my cash.
Structured settlements are mostly used in injury or product liability cases. It can be implemented to reduce costs such as legal costs by avoiding trial. In United States, structured settlement became popular in the 1970s as lump sum settlement alternative.
The periodic payment settlement Act of 1982 encourage the use of structured settlements in cases of physical injury and it provided incentives for its use by changing the federal tax amendment. It states that the payments should be paid in portions throughout a period of time and everything of every single payment of a structured settlement would be free from state, federal and local income taxes.
The following are some of the reasons why people obtain structured settlements
· Personal injury: if the plaintiff settles an entitlement for a hefty sum or wins a large jury award, the sum is organized into annual or monthly payments over a period of time. These payments are used by the recipient to pay for health expenditures and any other outlays.
· Wrongful death- structured settlement is a common way to compensate the family members of someone whose death was as a result of wrongful death claim.
· Workers reimbursement- structured settlements are used to compensate workers who get damaged on their jobs while recovering from the injuries.
Due to the benefits, structured settlements are more often than not, viewed as a better alternative than lump sum imbursements in different situations. However, the settlement terms can not be amended and thus sometimes it is superior for the receiver to sell the structured settlement for a lump sum payment.
Pros of Structured settlements
· Accrual of capital gains or interest earned on structured settlement money is excused from state, federal and local income tariffs. This provides greater savings.
· Payments in structured settlement can be scheduled for almost any time length. The payments can begin instantly, they can be delayed, and they can include lump sum payments in the future or advantage increases.
· Structured settlements are known not to be dependent on financial markets or state of the economy. The insurance company that provided the annuity contract guarantees the payments.
· In the event of premature death of the recipient, designated beneficiaries as in the contract can continue receiving any future guaranteed payments free from tax.
Cons of the Structured settlements – Sell My Structured Settlement
· Once the contract terms are finalized, there is little that can be done to alter the details. If the stream of payments does not meet the needs of the recipient, they can sell their structured settlements.
· In case of an emergency, funds are not accessible immediately. In addition to this, the recipient cannot use the lump sum payout to invest in other investments that may carry high return rates.
· IRS penalties and surrender charges are applied when funds are withdrawn before age of 59.
· Loss of lump sum payment option if you annuitize your annuity contract that is deferred or when you buy an immediate annuity.
Sell My Structured Settlement – Good Reasons
Whether you are thinking of starting a small business, purchasing a home or paying off loans and you need that money now, then selling your existing structured settlement payments might be your solution. If periodic payments of the existing structured settlement are not enough to cover your needs, you should consider selling part of the existing structured settlement, lump sums or all of it to meet your needs. The following are reasons why I should sell my structured settlement.
· Repairing or buying a home
· Investing or starting a business
· Funding a college or any other institution education
· Payment of debt such as student loans, credit card, medical and others.
· Investing in stocks, property or retirement funds.
The short and pretty obvious reason why you would want to sell your structured settlement, is to liquidate the cash in order to spend this on something where you are better off now, compared to waiting for periodical payments. However, keep in mind that this, more often than not will involve speculation – needless to say that any investment made can go down just as easily as it can go up. Because of this, you need to think things over carefully!
The following are the existing Structured settlement selling options
· Partial: this occurs when you sell part of your existing structured settlement. You will continue to receive payments from the remaining investment without any loss of the benefits of tax. The existing structured settlement continues to receive those benefits of tax.
· Entirety: selling entirety of your settlement means that you will not receive any periodic income payments from your investment. All you will have is a lump sum payment that you can use to invest.
· Lump sum: selling large lump sums over time period gives you large increments of money now but there is also guarantee you will have a steady income flow from your existing structured settlement for the term period of the contract. This arrangement still carries the same benefits of tax as before.
Selling My Structured Settlement – How it works
Selling of your existing structured settlement is straightforward. It starts with the decision to sell, setting up a date with the court and at last ending up with cash in your hands. The following are the steps.
· Making the decision to sell my structured settlement: if you have valid reasons why you need cash, selling structured settlement is one of your alternative, and the sale of your payments will not have any effects on your future financial needs, then you can start the sale of your settlement process.
· Contacting the agent for a quote for your structured settlement: this will give you information on how much your structured settlement is worth. It should be a competitive offer which allows you to know exactly what you will expect.
Various state and federal laws regulate procedure of transfer and they protect your rights throughout. Once the tender is offered, the law requires the agent to disclose all the pertinent details to you. These include:
· How much of your existing settlement rights you are selling.
· The exact cash amount you will receive
· The difference between your existing settlement payments value if the contract of annuity was to be maintained and their value if sold.
· Accepting a cash offer by Selling my Structured Settlement: During the process of negotiation, you will be required to supply documentation including the structured settlement contract between the insurance company that issued the annuity and you. You are also required to convince the company who is buying the structured settlement that you are making the right decision and that you fully understand that you are selling your rights of payments at a discount.
Depending on the state where you come from, you will either have the obligation or the right to seek outside professional advice before agreeing to enter into a transfer agreement.
Upon your cash offer acceptance, the buying company will send you the transfer documents necessary for you to sign and have notarised. The faster you return the documents the sooner the legal process will start. It can be helpful for example to get the documents through email instead of using regular mail especially if you are in need of the money very quickly.
· Receiving you cash advance: after signing the relevant documents and returning them, the entire legal process can take up to two months to reach the final outcome of the transfer. The agent can give you an advance which allows you to access some of your money during the waiting period.
· Having the judge say yes to your sale: once the relevant documents are returned and they are fully signed, a local attorney files them with court and after that the court will schedule a hearing. This is the beginning of the waiting period. To get on a court docket, you could wait thirty days or the wait may even be closer to sixty days. Mostly, the waiting period depends on where you live and what is on the court docket in the area. After the initial period of providing and gathering the relevant documents, the other work is handled by the agent and all you will need to do is to open up your schedule for the hearing. You should plan for court appearance.
In the court, the judge will require you to reveal all important financial information. You will be required to justify why the money is needed and you should be in a position to show that you are not putting your and your family’s financial future in jeopardy. In addition, you are required to identify any interested parties and you should submit proof that they had proper notification and they were given the opportunity to oppose, respond or support to your proposed transfer. Unless there are any problems with your request of transfer, the judges mostly approve the transfer at this stage.
· Getting your money: once the judges accepts your request for transfer, the transfer order is sent to the insurance company for acknowledgement and you will receive your lump sum payment from the agent. In some cases, when the agent purchases only a part of your existing settlement income stream, they begin by receiving your contracted payouts from the insurance company directly. They deduct their share of the amount and the rest of your payment is forwarded to you directly.
The amount you will receive from the sale of your settlement depends on factors such as current conditions of the economy and the amount you are selling.
Selling My Structured Settlement – Dependable factors
· payments amount and the amount of you settlement you want to sell
· timing and length of your payments
· any lump sums that you may be willing to sell
· current economic conditions
· extra charges and fees
Structured Settlement and Minors
Structured settlements for children are unique financial and legal tools. Traditionally, insurance companies were required to pay out large sums of money to the legal guardians or parents of minor children. It was found that the parents or the legal guardians would often use the money meant for the minor’s settlement for payments of item unrelated to the original principles of the tragic accident or law suit expenses.
In an effort to help the children in obtaining some control over the gains, it was recommended to recognize structured settlement as an alternative to lump sum payment. It is through the structured settlement where the minor has the chance to get into an agreement with the defendant of how much money and how they will be applied.
For example, when a structured settlement is created for a minor personal injury case, the settlement dollars are designed to cater for the future healthcare needs of the minor. It is for this reason that a structured settlement created for a minor may allow specific monies allotment to the benefit expense payments in addition to monthly annuity payment. Some of the created settlements for minors also include lump sum payments provisions at specific life events such as high school graduation.
To the minor child benefits, the created settlement monies are spent on the services for which they were intended for and not spent on other issues outside the settlement agreement terms which legal guardians or parents may involve themselves into.
To the defendant benefit- in most cases the insurance carrier- the structured settlement for minors provides a mean for saving money on large settlement cases.
Sell my structured settlement – Tips & Tricks
If you are thinking about selling your structured settlement, here are a couple of ideas you want to keep in mind. This should help you to get the most of the sale.
· get competing quotes by shopping around from several firms.
· You should get all the information and disclosure requirements upfront. You should ask about commitments on fees, timing and a guarantee. You should choose the type of structured settlement that work for you for example lump sum payment.
· You should know who you are dealing with. Make sure the company that you are dealing with has been in the business for some years and can do business across the country. Make sure they are financially sound.
· You should consult a financial planner and an attorney. You should be aware of selling structured settlement restrictions, you should also know the tax consequences, you should understand the impact of structured settlement sale on your future financial situation and you should make sure you have a plan and stick to it.
By now, you should know the basics of structured settlements and what to keep in mind if you want to sell your structured settlement. There are a lot of other posts here on the site, where you can find more detailed information on specific topics related to structured settlements. So if you still have questions about this topic, take a look around on the site and hopefully you will find what you are looking for. If not, you are always welcome to send us an email. We will reply back to you, and maybe even post your question along with an answer here on this site. You can also read more about structured settlement here at wikipedia. If you need more specific tips and tricks on how to Sell my structured settlement, head over and read sell my structured settlement now.