Structured Settlements: How to get the most out of them
Many civil cases never see a court room, because the parties agree to settle before it goes to trial. This could be in the negotiation stages, or during mediation, but the plaintiff would have to agree to cancel all further legal action in the lawsuit, in exchange for some compensation, in the form of money, from the defendant.
What is a structured settlement?
In a personal injury case, a structured settlement is an arrangement where the defendant pays the plaintiff the money split over regular payments, which could take several years. The defendant’s insurance company would typically fund an annuity policy which would produce a continuous stream of income for the plaintiff over the agreed time of the structured settlement. There are several pros and cons to structured settlements, so it is highly advisable that you seek professional advice from a personal injury attorney before you agree to any terms.
Selling your structured settlement
Once the annuity contract has been issued, the terms of the structured settlement are unable to be renegotiated. The settlement is supposed to be tailored to the needs of the injured party, but unfortunately, sometimes a crisis like a foreclosure or loss of a job can cause the person’s needs to change. Accessing the money from the structured settlement as a lump sum is not allowed, but you do have a right to sell your payments.
In light of circumstances like these, there are companies which have been specifically set up to buyout future payments of structured settlements and pay out a lump sum. There are federal and state laws in place which help to protect customers against companies that try to prey on those in desperate situations.
If you intend to sell your structured settlement, check with your attorney if you are unsure and get all the details in writing. It is a major financial decision and shouldn’t be taken lightly. Ensure that no further fees are passed onto you. Whatever lump sum you agreed, that amount should be on the check.
How to choose the right settlement company
If you have made the difficult decision to seek out a lump sum in exchange for future payments of your structured settlement, then you need to find a reliable settlement company to buy your settlement.
Things to look for include:
– Experience: try to find a company who has specific experience with structured settlements and not just annuities in general.
– A direct number to a representative: this is a complicated process, and you are sure to have questions along the way. It is extremely annoying to have your query be passed from department to department while you wait on the phone explaining yourself repeatedly. Try to get a direct number to someone who knows your case, so you can just pick up the phone whenever you need something.
– A written offer: if the company makes you a verbal offer, that’s fine; but don’t be afraid to demand something in writing too. Someone should be taking the time to explain what the terms of the agreement mean, not pressuring you into signing.
There are several companies offering to buy structured settlements, so it won’t be easy to choose one that suits you. Here are some quick reviews of three of the top companies offering this service:
JG Wentworth advertises themselves as “The Industry Leader in Purchasing Structured Settlements”. They don’t just make an offer based on your current arrangements, but they sit down with you to discuss your options and your cash requirements. Once you’ve come to an agreement, JG Wentworth will deal with all the paperwork and file the petition. Each sale mustbe approved by a judge so that companies cannot exploit the injured party. The judge must determine that the sale is in your best interest.
JG Wentworth has over 25 years’ experience in the industry, so boast of their success rates in this area and getting the sale approved. Once that is done, you will receive your lump sum in approximately three business days.
Olive Branch Funding:
Olive Branch brag that they offer larger cash advances than their competitors and can get it to you in 72 hours. They also have bigger cash advances too – 20% of the proposed purchase price, unlike 6.6% given by their competitors.
SenecaOne offers $5000 instantly, and this even applies to those with poor credit or who are unemployed. In reality, the cash advance is in the form of a Pre-Paid Visa card, but you get it in under 24 hours. They pride themselves on having no hidden fees or extra costs, and no obligation.