Structured Settlements: Pros and Cons
ADVANTAGES AND DISADVANTAGES OF A STRUCTURED SETTLEMENT SELLING
Selling your structured settlement or annuity can have excellent and even life-changing implications. Selling your payments can vastly improve your standard of living. But, there are downsides to selling that each and every owner of a structured settlement or annuity needs to be aware of before making the final decision.
While it may seem that receiving a lump sum of cash carries little downside, keep in mind that to receive that payment, you will be forgoing future payments from your structured settlement when you decide to sell it in its entirety. In essence, by selling a structured settlement or annuity, you are effectively ‘borrowing’ from your future self.
With RSL Funding, you have the option to sell some payments, while leaving the remainder of your scheduled payments intact.
When a customer comes to RSL Funding looking to sell their structured settlement, we make sure they have a thorough understanding of the advantages as well as the drawbacks of their decision. The following are the pros and cons of selling a structured settlement or annuity that you need to be aware of before you make the decision to sell.
A) PROS OF SELLING A STRUCTURED SETTLEMENT
1-Immediate access to a large lump sum of cash that otherwise would have taken months or even years for you to receive
2-The ability to invest in endeavors that can substantially improve your future prospects, such as credit card debt repayment and consequent credit repair, furthering of education, home ownership, business ventures, etc.
3-Relief from healthcare-related debt
4-Unlike a loan, the money you receive is yours and never has to be paid back
B) CONS OF SELLING A STRUCTURED SETTLEMENT
1-Once you receive a lump sum payment after selling all of your payments, you will no longer receive your structured payments
2-Effectively managing a one-time, large infusion of cash is much more difficult than budgeting based on smaller, predictable structured payments
3-Certain unscrupulous structured settlement buyers will allow you to “sell” your structured settlement before a court has awarded you the settlement in what is called ‘pre-settlement funding’. If the judgment isn’t returned in your favor, you will end up owing back the money at exorbitantly high interest rates
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