Blunt Facts about Cash for Structured Settlement Transfers
Posted by: Gene Banyan / Category: Personal FinanceDo you want cash for your structured settlement? Brokerage companies, also known as factoring companies, want to trade you lump sums of cash for your future annuity payments. If you are looking for money, want it now, and are willing to lose long term money, for that lump sum payment, structured settlement companies might be for you.
There are many important parts of a negotiation for your payment rights. If you want cash for payments, don’t be so quick to sell. Do you know that if you do sell your rights to a brokerage company you will be transferring ALL of your future payment rights to them?
You can see commercials for structured settlement payment transfers on TV all the time. They are making a boat loads of money in this business. Most cash for structured settlement brokerage companies do business ethically, you should keep in mind that they want your money. Every interaction you have with them is designed to get your payment rights transferred to them. So, no matter how friendly the people might sound on the phone, they’re NOT your friends. They only want your cash.
So unless you are really on hard times or you MUST have the money now or the house will be foreclosed, it’s in your best interest, financially, to tough it out and keep your payments.
Structured settlement companies profit, in part, by paying people like you a lump sum of cash that is less than the discounted face value of your annuity payments.
It is common knowledge that many of the structured settlement companies have abused their consumers. Because of this abuse from structured settlement companies, now guaranteed favorable tax treatment is now at your disposal, if you wish to transfer your structured settlement payments.
California has a law, Structured Settlement Transfer, SSTA, that requires: (1) disclosures to the seller of the structured settlement payment rights, (2) notice to the Attorney General, and (3) court approval.
The transfer of payment rights will require the brokerage company to file a petition in the county where the transferor lives. To grant the transfer of rights for approval, the court must determine:
(1) the transfer is in the best interest of the transferor, taking into account the welfare and support of the transferors dependents;
(2) the structured settlement seller has been advised in writing to seek legal and financial professional consultation and either has received counsel or decided to waive it;
(3) the structured settlement seller has received disclosure forms;
(4) the structured settlement payment rights transfer will not interfere with court orders;
(5) the seller of payment rights understands the terms of the agreement and disclosure form; and
(6) the structured settlement seller understands his or her right to cancel the transfer of payment rights and does not want to do so.
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Tags: Annuity, Debt Consolidation, endowment, Finance, investment, legal, Loans, Personal Finance, Structured settlement, taxes, tort, wealth building