How Structured Settlement Funding Is Determined

When you win a judgment in any of various court actions or out of course settlements, it is likely that there will be an amount specified as the judgment sum.

If the amount is large, you may have to agree that the funds would be paid to you in a series of payments. The structured settlement funding program can vary according to the needs and desires of the plaintiff.

The payment schedule is set up with almost unlimited flexibility. You can choose the amount your want to receive in each payment.

You can specify that the funds are to received monthly, once per quarter, twice per year or annually. You can structure the payments so they will increase over time to keep pace with expected inflation and cost of living increases.

You can structure payments to arrive every month for twenty years and then annually thereafter. You should try to take as many eventualities into consideration as possible before designing the payment schedule. However, if you come up against some unforeseen expenses, there is a remedy under the laws of most states.

You can transfer the rights to receive future monthly or other periodic payments to a buyer and receive a lump sum in cash for those rights.

Actions under the structured settlement laws are relatively recent. For many years, plaintiffs were not allowed to transfer the payments or the right to receive payments to a third party.

Now, laws in most states and many countries allow for this eventuality. There are certain clauses that apply when there is an action to request a modification of terms.

Usually the structured settlement awards are fulfilled by purchasing one or more annuities to prepare for any future payments at the time they come due. Some of these annuities have a no-transfer clause associated, but if the judge decides it is a legitimate use of the funds, this stipulation can be set aside.

The proposed transaction must meet certain qualifications, but the final decision is done by the courts. The history of the transactions show that the term "best interest" is widely interpreted.

Structured settlement funding programs are as numerous as the types of people who are awarded funds. If you are deciding on a company to handled the structured payments or to sell the rights to such payments, you should find the one with the best experience and performance record. Don't use a company that is simply a broker. You should choose one that has funds to invest.