How a Structured Settlement Annuity Works
Structured Settlements
A
Structured Settlement usually results from a personal injury lawsuit and is an
agreement where you have agreed to accept payments over time in exchange for
the release of liability for your claim.
Settlement
Purchasers can purchase all or a portion of this type of structured settlement
payment to meet an emergency or your financial needs. These needs may include:
Medical
expenses
Debt
elimination
Education
costs
New
business opportunities
New
home or automobile purchases.
Sell
your structured settlement payments to receive a lump sum of cash now. With the
option to sell future payments, you have the ability to take control of your
financial situation, without having to wait for your money to be paid out over
a number of years.Solve your cash flow problems simply by having your money
when you need it – now!
Settlement
Purchasers is a direct funding company that provides quick cash solutions for
receivers of deferred payments such as structured settlements, including
insurance settlements and lottery winnings. We offer individuals the
opportunity to sell annuity payments, sell structured settlement payments for
cash they can use today.
Since
1988 we have provided much needed financial support and cash for settlement
payments to thousands of customers, many of whom could not be helped by
traditional financial institutions, such as banks or credit unions.
Our
mission is to provide customized and flexible buying programs to recipients of
structured settlements and annuities, and allow them the financial freedom they
deserve. We offer cash for structured settlement payments, cash for future
payments and cash for annuities.
Take
advantage of one of our many cash option programs so you can immediately gain
control of your current financial situation, and receive cash now for your
future payments!
A
Structured Settlement is essentially an agreement under which an insurance
company agrees to pay an individual a predetermined amount of cash for a fixed
length of time if the individual meets an accident. The documents generated in
a structured settlement include an agreement, a qualified assignment, an
annuity application, a court order if a claim is made by a minor, and an
annuity policy.
Payments
for a structured settlement annuity can be made for the duration of the life of
the claimant. The amount paid can comprise of equal installments, installments
of varying amounts, and lump sums. The payments from a Structured Settlement
Annuity are free from income-tax and are guaranteed by contract. Since a
structured settlement annuity is meant for long-term financial security, it is
important to get an assurance of the credentials of the annuity provider.
The
periodicity of payment is entered into the settlement agreement. Factors that
individuals can consider in deciding upon the date of commencement of payment,
duration, and periodicity include monthly expenses, present age, extent of
hazard in occupation, and retirement plans. In order to ensure that the payments
remain tax-free, the structure of payments should not be altered once it has
been agreed upon by both parties. In the case of a qualified assignment, the
insurance company making the payment can transfer its obligation for payments
to a third party.
There
are issues that one should understand before opting for a structured settlement
agreement. If payments are made to an estate, they are free from income tax but
subject to estate tax. Purchasing a structured annuity can affect the
availability of ready money with an individual.
State
and federal laws govern the closing of a structured settlement. The closing
process usually gets completed in 3-6 months. Federal laws stipulate that a
court order be obtained by either the customer or the funding company that is
purchasing the payment stream so that there are no tax liabilities. The manner
in which the court order is obtained is regulated by various “Structured
Settlement Protection Acts”, which are in force in 36 states in the United
States.
A
disclosure statement is made available to a customer 3 to 14 days before he
receives the transfer agreement. The disclosure statement mentions the amounts
to be paid to the customer and their due dates; the IRS Discounted Present
Value of the amount at that given point in time; the Gross Advance Amount and
the Annual Discount Rate; disclosures desired by the state; and a list of the
fees and commissions incurred.
It
is advisable to avail attorney advice before going in for a. In fact, in some
states, it is a precondition to acquiring a structured settlement annuity.
However, depending upon the laws being used for the transaction, customers do
have the option of waiving legal representation in the Transfer Agreement or
obtain an Estoppel letter from their attorney.
The
funding company commences payment to an individual after acknowledging the
assignment and receiving a court order. The payments start 30-45 days after the
receipt of the court order.