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An Informative Guide to Structured Settlement Loans Almost anyone residing in the U.S is eligible to receive a structured settlement loan. Most people pursue structured settlements to receive compensation from individuals or businesses in the result of a lawsuit. The payout structure is done over a set period, and usually in equal installments. The installments are delivered through as collateral or in the form of a life insurance agreement. Applying for a structured settlement loan is very easy. In order to apply for a loan, there are a few prerequisites that must be met. First things first, you need to know what type of structured settlement you have. If you are planning to take out loans or financial leverages, so you can use them as collateral, there may be a clause that permits you from doing so. You are eligible to apply for a loan if there are no such restrictions permitting you from doing so. If the settlement has been reached, you still may need permission of court. Also, if the settlement took place out of court, then you may need permission from the defendants or the insurer. After you’ve done your due diligence, and you’re certain there are no restrictions, you can then begin the loan application process immediately. After evaluating the paperwork, either the bank or financial institution will accept your application. In some cases, processing can take up to 4 months. You also might want to consider the option to sell your annuities. Selling your annuities, will make it possible for you to receive the money in 6 weeks or less. There will be a fee after your application has been processed and your loan has finally been approved. The the total amount of the loan will also incur some other costs that will be deducted as income tax. The good news is you can spend the loan amount as needed and pay it back through annuity payments.
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The sale of the settled agreement should be compared to the loan disbursement. In the event of an annuity sale, you might be responsible for higher fees and a deduction of taxes. Your settlement agreement will be terminated as a result, so you won’t be receiving any future payments. The way to keep your settlement plan in place, is to apply for a structured settlement. You are still going to have to repay the loan.
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Although the majority of annuity buyers on purchase 50 percent of the settlements, most of the loans are spread over the entire payment plan. This option provides you with the most leverage, as it will give you a number of spending options. The safest way to proceed is to research the credentials of structured settlement loan lenders. If you choose to hire a lawyer, you will protect yourself from any hidden fees or conditions you may have overlooked.