What Are Structured Settlement Loans?

Structured settlement loans are cash advances against the funds you will receive in the future due to a lawsuit settlement or lottery option. If you are expecting annuities as a result of either of these scenarios, you may find you have an immediate need for the funds that cannot be met through annuities. You can use those anticipated cash payments as collateral to get cash for the present.

Reasons for Structured Settlement Loans

The main reason to take this type of loan is because you have a pressing emergency that cannot wait. An emergency medical condition or a pending loan default is an example of this type of situation. In both cases, waiting to receive your payments will not help solve the problem you are in currently. You may also take the loans in order to buy a home, pay for college, or pay for a wedding in the short-run.

Risks of Structured Settlement Loans

These loans are very expensive, so you will end up losing money when you compare them to simply waiting for the annuities to pay out. For this reason, the loans are only recommended if you are in a state of emergency or feel you can build equity by taking the loan now.

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