Structured settlement payments are becoming popular because of the advantages they offer over other forms of payments and investment options. The payments which are available in the form of annuities are tax-free at the state and federal levels. Moreover, the payments are secured by state and federal laws. The annuities can be invested in U.S Treasury Securities and other low-risk government insured options.
As against a structured settlement, a lump sum can be difficult to manage by an individual who will have to grapple with the complexities of financial investment and tax laws. Moreover, if the management of a lump sum amount is handed over to a third-party who turns out to be unscrupulous, the resulting loss can be very heavy. In contrast, with structured payments, the loss is usually of an amount due at a given time. Structured settlements offer flexibility and the payment cycle can be fixed according to the beneficiary's convenience.
Structured settlement payment schedules and amount are decided after carefully considering the beneficiary's present financial condition, age, and responsibilities. The annuity money can be used to pay off a large bill upfront and the remaining money can be obtained over a period. People who meet with an accident and are unable to earn for themselves prefer a structured settlement payment that keeps the money coming in regularly. It allows them to plan for their future and the future of their near and dear ones.
The Federal tax code was amended in 1982 to allow for structural settlements; this was done so as to allow individuals better security with large sums of money. A major advantage of structured settlements is that they are adjusted for inflation so that their sum is greater than a lump sum payment for the same amount. The paying party, which is frequently an insurance company, also prefers structured settlement payments because the payments are bought upfront in the form of an annuity and the amount they pay is less than the sum received by the beneficiary. A defendant too favors a structured settlement as it saves him the cost of court expenses and stiff attorney fees. Thus, structured settlements are beneficial for all involved.
About the Author:
George Hostetler recommends http://www.structured-settlements-guide.com/2006/03/why_a_structure.html for more information on selling a structured settlement payment.
Read more articles by: George Hostetler
This article is distributed by: www.iSnare.com
Sunday, October 28, 2007
Why Sell Structured Settlements? - This article provides useful, detailed information about Why Sell Structured Settlements?.
Let's imagine that a person is injured in an accident. He goes for a personal injury lawsuit and wins the case. The result would be a structured settlement, an agreement by which the person agrees to accept payments over a period of time in exchange for the release of liability for his claim. Structured settlements are like bank certificates of deposit, or annuities.
Although they offer a guaranteed periodic income to the person, they cannot meet his immediate or unexpected financial needs, such as medical expenses, debt payment, new business opportunities or any other such circumstances. However, the person can sell his or her structured payments structured settlement purchasers and get cash in a matter of days.
Many states in the U.S. have laws to help people sell their structured settlements in a risk-free manner. Structured settlements are sold as follows. The person concerned, who wants to sell his structured settlement, forwards documentation containing the insurance company's name and settlement payment plan to the settlement purchasers. Based on this information, the latter provides a free quote. If the person is interested, he sends a copy of his structured settlement policy and the settlement agreement. Then the two parties, the person [Seller] and the buyer [Settlement Purchaser], draw up a mutual agreement. This agreement, along with the application for selling the structured settlement, is submitted to the court for approval. The court reviews the application to confirm if it is in the best interests of the applicant. The settlement purchaser does all the processing. On average, the court process takes around 2 to 3 months, depending on the state laws in force.
According to Federal and state transfer acts, only personal injury settlements can qualify as structured settlements.
It is important to ensure that the insurance firm and settlement purchase company are licensed (http://www.articlesfactory.com), and that all transactions are approved by a court order. Selling structured settlements can help meet major financial needs.
ABOUT THE AUTHOR
Annuity Calculators (http://www.e-sellannuitypayments.com/) provides detailed information on Annuity Calculators, Annuity Leads, Cash For Annuity Payments, Sell Annuity Payments and more. Annuity Calculators is affiliated with Sell Annuity Settlement (http://www.e-sellannuity.com/).
Although they offer a guaranteed periodic income to the person, they cannot meet his immediate or unexpected financial needs, such as medical expenses, debt payment, new business opportunities or any other such circumstances. However, the person can sell his or her structured payments structured settlement purchasers and get cash in a matter of days.
Many states in the U.S. have laws to help people sell their structured settlements in a risk-free manner. Structured settlements are sold as follows. The person concerned, who wants to sell his structured settlement, forwards documentation containing the insurance company's name and settlement payment plan to the settlement purchasers. Based on this information, the latter provides a free quote. If the person is interested, he sends a copy of his structured settlement policy and the settlement agreement. Then the two parties, the person [Seller] and the buyer [Settlement Purchaser], draw up a mutual agreement. This agreement, along with the application for selling the structured settlement, is submitted to the court for approval. The court reviews the application to confirm if it is in the best interests of the applicant. The settlement purchaser does all the processing. On average, the court process takes around 2 to 3 months, depending on the state laws in force.
According to Federal and state transfer acts, only personal injury settlements can qualify as structured settlements.
It is important to ensure that the insurance firm and settlement purchase company are licensed (http://www.articlesfactory.com), and that all transactions are approved by a court order. Selling structured settlements can help meet major financial needs.
ABOUT THE AUTHOR
Annuity Calculators (http://www.e-sellannuitypayments.com/) provides detailed information on Annuity Calculators, Annuity Leads, Cash For Annuity Payments, Sell Annuity Payments and more. Annuity Calculators is affiliated with Sell Annuity Settlement (http://www.e-sellannuity.com/).
Why Would A Company Want To Buy My Structured Settlement?
There are several structured settlement companies and corporates that purchase structured settlements and offer a lump sum in exchange. The simple reason for a company to purchase a structured settlement is that it represents a good investment deal. Structured settlement payments from lottery winnings, royalty payments, and insurance annuities are income-tax free and are secured by federal and state regulations.
Companies that purchase structured settlements are thus assured of a steady stream of income over a period of time which allows them to execute their growth plans in an assured manner. Alternatively the money can be invested by these companies where the principal continues to grow.
Corporates purchase structured settlements at a profit. This means that the amount which the seller receives is a discounted amount arrived at by factoring in the profit margins and bank interest rates. Also, by purchasing a structured settlement companies are able to obtain loans more easily. This is because of the secured nature of these settlements. The loan money can be used to pay off a large chunk of the lump sum. Thus, the company ends up paying very little out of its own pockets.
Structured settlements represent secured finances that help improve the market standing of a company which has a healthy effect on their businesses. They represent a safe business option for their partners because of their financial soundness. The more business they generate and prosper the less need these companies have for middle-men in their dealings with sellers of structured settlements. This allows them to offer the best rates to sellers by eliminating broker's commissions.
The work involved in executing a structured settlement sale basically consists of marketing activity and working with the seller for acquiring court approval. Companies do not require diverting too many resources to this activity but the returns of the efforts are manifold. At any point in time, there are individuals who need cash for immediate use. By establishing a network through agents and by maintaining an online presence, structured settlement buyers can tap into a lucrative source of guaranteed and income that will last them for a long time.
About the Author:
George Hostetler recommends http://www.structured-settlements-guide.com/2006/03/why_does_a_comp.html for more information on how to sell or buy a structured settlement.
Read more articles by: George Hostetler
This article is distributed by: www.iSnare.com
Companies that purchase structured settlements are thus assured of a steady stream of income over a period of time which allows them to execute their growth plans in an assured manner. Alternatively the money can be invested by these companies where the principal continues to grow.
Corporates purchase structured settlements at a profit. This means that the amount which the seller receives is a discounted amount arrived at by factoring in the profit margins and bank interest rates. Also, by purchasing a structured settlement companies are able to obtain loans more easily. This is because of the secured nature of these settlements. The loan money can be used to pay off a large chunk of the lump sum. Thus, the company ends up paying very little out of its own pockets.
Structured settlements represent secured finances that help improve the market standing of a company which has a healthy effect on their businesses. They represent a safe business option for their partners because of their financial soundness. The more business they generate and prosper the less need these companies have for middle-men in their dealings with sellers of structured settlements. This allows them to offer the best rates to sellers by eliminating broker's commissions.
The work involved in executing a structured settlement sale basically consists of marketing activity and working with the seller for acquiring court approval. Companies do not require diverting too many resources to this activity but the returns of the efforts are manifold. At any point in time, there are individuals who need cash for immediate use. By establishing a network through agents and by maintaining an online presence, structured settlement buyers can tap into a lucrative source of guaranteed and income that will last them for a long time.
About the Author:
George Hostetler recommends http://www.structured-settlements-guide.com/2006/03/why_does_a_comp.html for more information on how to sell or buy a structured settlement.
Read more articles by: George Hostetler
This article is distributed by: www.iSnare.com
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