the answer is no. The
laws regarding structural settlements are designed to protect you
from abuse, and the ability to use structured settlements as
collateral would void that intended purpose.
The payments however, can be claimed as a form of income so
that if you want to buy a house, the payments represent the same
financial ability that a take home paycheck of the same amount would
place, can structured settlements be traded back for a
lump sum settlement?
No. You are given special tax treatment with regard to
structured settlements' proceeds, and you cannot then take that in a
lump sum fashion and invest it again.
Do I get
interest on structured settlements?
No. The interest is a part of your structured settlement
agreement and is therefore, tax-free.
You do not then get interest on top of that.
This however, is not to say that if you get your regular
structured settlement payment and donít spend all of it, that you
cannot invest that remainder into another account and draw interest
from that. That
interest however, would be taxable.
ads for turning my cash payments into a lump sum.
Is that like renegotiating the structured settlement?
the surface, they may sound the same, but they are not.
Structured settlements may not be paid out in any
different fashion than initially agreed upon.
What these ads talk about is selling the payments to them.
They would receive the payments just as you would have over
they do for you is to buy them for a far lesser amount than the
gross proceeds than you would get over time.
Remember though that they are taking certain risks that are
attached to inflation, and they also need to make money in the
transaction. Consequently, the amount that they give you will be
substantially less than the face value of the structured settlement.
Structured settlement buyouts ads sound like they are giving
something nice. But
this is real business and you most certainly lose money long-term in
exchange for getting it sooner.
upon the term of structured settlements and the company making
the offer, you may lose 50% of the total amount to be paid to you
over the long run. If you need to go this route, donít settle for the first
deal that comes your way. Talk
to as many companies as you can find and let them know that you are
checking many deals. They
are not all the same.
should also seek the advice of your attorney before signing anything
or taking any payment from anyone.
Structured settlements can have many different requirements
and are subject to different laws.
Before you enter into any agreement regarding your structured
settlement, you want to make sure that you donít put yourself in
legal trouble or find that there are things that you are agreeing to
that are not in your best interests.
on Structured Settlements