Structured Settlement Cash - What You Should Know

Some people who have been parties to a structured settlement agreement might find that the periodic cash payments are not exactly what they need. Unfortunately, there is not much that they can do to back out of the agreement once it has been legally settled. A structured settlement is an arrangement entered into by individuals who have been parties to a personal injury claim or an employee benefits claim. In these claims, the amount in consideration is often too big for the accountable party to pay in lump sum. And so, through a settlement agreement, both parties agree to a series of periodic payments made for a specific number of years to complete the amount payable to the aggrieved party. It is not unusual for someone holding a settlement agreement to be offered by parties structured settlement cash purchases.

When you are offered with a structured settlement cash purchase, the company is actually offering to purchase your settlement in lump sum. This might seem like a good offer, especially if you have a big purchase or investment in mind or if you need the cash to fund your living expenses. There are, however, some states that do not allow the sale of these structured settlement agreements. You might find that your state laws will actually prevent you from cashing in on your settlement agreement sooner than what is legally agreed upon with your insurance company or your previous employer. This restriction is due to the provisions in the annuities bought to ensure the completion of your payouts that prevent its assignment or transfer to third parties.

While a structured settlement cash purchase sounds beneficial to you in that you will be able to get your money right away, it might do you good to think about what disadvantage such a purchase could bring you. These purchases do not often go down in one sitting. The usual procedure requires that you first agree to the buy out and go through the necessary documentation before you actually get your money from the buyer. In cases when no-name companies are involved, you might not be able to get all your money before the company you are dealing with folds or disappears. It is important for you to know for sure how sound and credible the company buying your settlement is. It would be to your best interest to consult a lawyer before you agree to any purchase.