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					Selling Structured Settlements - Is It Right For You?

There are any number of lenders that will offer to purchase structured settlements up front in exchange for a cash payment. If you are in this situation, carefully examine the pluses and minuses before deciding if you wish to sell your structured settlement. See if it fits your current personal and financial goals. The disadvantages of selling structured settlement payments are what we will look at first. The primary disadvantage is that you will be receiving less money up front, if you take the cash offer from the settlement buyer, than if you had continued to receive payments. In the long term, it would have been better to hold onto your payments if you are considering the total monetary value of the settlement. Next on the list of disadvantages is the taxation factor. You may incur large federal and state tax liabilities if you take a lump sum of cash, while your original payment plan may be structured in a way to shield you from taxes. Dealing with unethical buyers of structured settlement plans is another possibility. The structured settlement industry is relatively unmonitored, and you need to do your homework and find an ethical and reputable buyer. Another disadvantage is the paperwork, red tape, and regulatory hurdles involved. Don't expect to receive cash for your structured settlement quickly. Processing the paperwork may take anywhere from one to three months, or even longer. Let's look at the advantages of selling structured settlements. One major advantage is that your credit rating does not need to be stellar. People with poor credit can still receive cash for structured settlement payments. The buyer knows that you are not a risk, because you are already receiving payments on a regular basis, and all they need to do is transfer those payments to them. Getting a lump sum of cash gives you some options you may not have otherwise had. If you need access to liquid capital for a home or real estate, starting a business, or investing, then this may be right for you. If you don't think you can handle the money responsibly, it may be better to keep receiving regular payments. You may want to get the money from selling structured settlements to reduce your inflation risk. If you think you can hedge against inflation through wise investing or other methods, then it might make sense for you to take the payment. Keep in mind that you would still need to factor in the discount that was taken off the top at the time you sold your structured settlement payment, and determine if you can also make up the difference there. Lastly, if you think that you will not outlive the term of your structured settlement payments, you may wish to sell your structured settlement. For example, you may be expected to receive payments for fifteen more years, but predict that you will only live for ten more - in this situation selling your

payments might make sense. This could also help you plan your estate and leave a more predictable amount of money to your heirs. Author Malcolm Goodwin can help you decide if selling structured settlements is a good decision in your case. Visit his team at Settlement Selling to read more about this important decision.


				
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