When you’re injured because of the negligence of another person or company, you might end up in a civil lawsuit to cover damages caused by the incident. The person, business, or insurance company can settle the case with you rather than go through a long and costly trial.
If there is a large payment amount, then the defendant creates a structured settlement. What is a structured settlement, and what can you do if you need money right away?
We created this guide to help you understand what it is, so you can make the best decision on handling it. Keep reading!
What Is a Structured Settlement?
The defendant doesn’t want to pay the entire settlement at one time, so they ask for a structured settlement. The settlement amount is structured into many smaller payments over an agreed-upon period instead of a lump sum.
The defendant, likely the insurance company, assigns a qualified third party to give the payments to the victim. The third party must be approved by the courts. Rarely is a settlement not assigned to a third party.
Once everything is done, the victim receives the agreed-upon monthly payments. The amount of the payment depends on the total of the settlement and negotiations between the defendant’s lawyer and your lawyer.
If you die before the end of the settlement payments, it transfers to your spouse or whoever you choose in your will.
What Is Structured Settlement Financing?
A civil court case and settlement can take a long time to complete. Meanwhile, you need to pay bills and buy groceries, but you have no income coming in.
If you have a good chance of settling, then you can choose a company like Rightway Funding to provide a structured settlement loan. You agree to provide the lender with all or a portion of the settlement in exchange for a loan now.
This lets you pay your bills and survive while the case continues. When the settlement is complete, the settlement payments go to the lender until the loan agreement is fulfilled. If the case does not go in your favor, you do not have to pay back the loan.
Sell the Structured Settlement When Complete
You can sell your structured settlement when the lawsuit concludes as well. It’s like structured settlement financing but instead of getting a loan during the lawsuit, you wait until it’s finished.
This allows you to get a lump sum payment instead of waiting for the monthly payments. You agree to sign over the payments to the financing company to pay off the loan.
You can pay off your debts such as medical bills, or use the large lump sum payment to purchase a home or other large item.
Choose Your Settlement Options Wisely
There are pros and cons to a structured settlement.
Knowing what they are and how they work is an important step in deciding on what to do with them. Talk to your lawyer about the potential settlement and if you need early financing to cover your bills.
If you want to learn more about structured settlements, then please explore our site.