You can get structured settlement loans in almost every state in the US Most people enter into structured settlements to get compensation from companies or individuals after lawsuits. This compensation is paid in a determined period of time and in equal installments. These installments are mainly in the form of a life insurance contract that can also be used as collateral to obtain loans. The procedure to apply for structured settlement loans is easy and fast.
Requirements
If you want to apply for a loan, you first need to understand the type of structured settlement you have. It would be a mistake to apply for a loan when your structured settlement has a clause that you cannot obtain loans or financial leverage using the document as collateral. However, if there are no such restrictions present, you can apply for a loan. Permission from the court will still be required if a settlement has been reached per its instructions.
You will also need to seek permission from the defendants and the insurer if you have settled out of court for your personal injury claim. You can immediately begin the application process for your loan once you are sure that there are no restrictions or legal inconveniences.
Application
The financial institution or bank can accept your loan application after examining and evaluating all the documents. Processing can take 90-120 days in some cases. On the other hand, selling your annuity won’t take as long since you can get money in 45 days or less.
You will have to pay fees once your application has been processed and the loan approved. This fee and certain other charges and some jurisdictions also deduct some income tax on the loan amount. However, you can spend the loan amount as needed and pay it back with annuity payments.
Comparison to clearance sales
You should compare the sale of the settlement agreement with the disbursement of your loan. If you have to sell an annuity, you may have to pay more fees and there would also be some tax deduction. This will end your settlement agreement and you will not receive any future payments. If you take out a structured settlement loan, your original settlement plan will remain intact, but you will have to repay your loan with these payments.
Most annuity buyers only buy 50 percent of the deals, but most loans are spread over nearly 100 percent of the payment plan. This offers much better leverage for all those who apply for loans, since they can spend on various options, including investing in property.
Check the credentials of the structured settlement loan lenders you are considering. Hire an attorney because they can review the loan contact documents before you sign them, and they will make sure you understand the loan terms, interest, and other conditions. Also check for hidden costs and fees that were not discussed during the initial stages. Familiarize yourself with current interest rates on structured settlement loans to ensure you are not charged outrageously high rates.
