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Dare to Say No to Structured Settlement Advances

In my last article we discussed the option of taking a cash advance on your structured settlement while your case is still open. This can be an attractive offer when you are facing some sort of financial crisis  and are “expecting” to win a structured settlement, but haven’t finished the court or settlement process yet. As I said before; You do have the option of applying to various companies to take an advance out on the estimated value of your settlement. Sounds easy. It is. Sounds quick. It is. What it isn’t.. is cheap or necessarily wise. Last time we went over the “Pro’s” of such an advance, and they are many. However, this time we will be focusing on the “Con’s” of such an arrangement.

Expense. While it is true that getting an advance may allow you to hold off on settling to a point where you come out with a larger lump sum, the reverse is also true.. You may come out with much less. As a rough example of costs you can expect to pay $1500- $2500 per $10,000 advanced to you. Also, while you are waiting for your case to settle, your cash advance on your future structured settlement payments will accumulate interest until settlement is made. This can be as low as 2% or as high as 25% depending on the lender you have chosen. Here you must remember that the longer your case takes to settle, the more interest you will have to pay.

Scams. This is a prime time for unscrupulous individuals, businesses, or agencies to take advantage of your need and get you to sign a contract containing many hidden fees leaving you with little to nothing after your settlement is done. If you are considering taking an advance I can not stress enough the importance of reading all the fine print, having everything verbally explained to you, and possibly having any contracts reviewed by an outside attorney.

Can take only days or it could take several months. In many cases you can receive your advance in a matter of days, however it is also possible that after signing for your advance that these companies will include delaying clauses resulting in a situation where you would have received your cash sooner had you never done the advance.

When taking a loan or an advance, take time to calculate what you need – don’t ask for what you want, but ask for what you need. Many people make the mistake of asking for more than they need. If you have other money sources that cost more, then you can justify asking for more, but try to keep within reason – you don’t want to be dinged in high interest rates and fees unless absolutely necessary. Anytime you get a loan or advance, the cash you get costs something.

If you need help selling your structured settlement, annuity or lottery payments,
contact us today. We are here to answer your questions and help you obtain the
highest possible price for your payments.

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