After suffering a devastating injury or dealing with a difficult litigation process, you may finally be on the road to recovery when your case settles and you receive a structured settlement. However, when you are waiting for your structured settlement payments to begin, or if you are between payments and are struggling to cope financially, you may be wondering whether you have the opportunity to take out a loan against your structured settlement.
Unfortunately, you will generally not be able to take out a traditional loan against a structured settlement. However, that does not mean you do not have options. Contact our team of loan specialists at High Rise Financial today to learn more about what options may be available to you.
Why You Cannot Take Out a Loan Against Your Structured Settlement
Generally, when you are applying for a home loan, you will need collateral to get the loan from a bank. This way, if you default on your mortgage, the mortgage lender can seize the collateral and sell it to recoup their losses. Although structured settlements may typically be considered assets, unfortunately, traditional mortgage lenders will not have any way to sell your structured settlement payments to make money back.
Since structured settlement payments are also coming to you tax-free, you are generally prohibited from selling them so the bank can use them as collateral. This would be a liability for the mortgage lender. However, that does not mean that you do not have the opportunity to sell your structured settlement payments and obtain the cash you need to purchase your home.
Selling Your Structured Settlement Payments
Selling your structured settlement payments or obtaining a lawsuit loan may be your best option if you are hoping to obtain a sum of money large enough to purchase your home. Instead of reaching out to a traditional bank, mortgage lender, or financial institution where you will have to pay back your home loan over time, selling your structured settlements could be a good way to get around having to get into debt via a home loan.
However, if you are hoping to move forward with selling your structured settlement payment, it is important to remember that there will be a judge involved. This will help to protect you from predatory lending, ensure that selling your structured settlements is in your best interest, and take into consideration how your children or dependence will be affected by you selling your structured settlement payments.
Another benefit of selling your structured settlements is the ability to avoid the outstanding interest rates associated with mortgage loans. Ultimately, you wind up paying significantly more for your home than it is worth when you add compounded interest. Getting a lump sum of your future structured settlement payments could be a great way to get the home you have been dreaming of without the risks associated with a traditional mortgage.
How Selling Your Structured Settlement Is Different from a Loan
When you have already been through a difficult legal battle, taking out another loan may not be the right move for you. Even if you are hoping to purchase a home, getting into debt is never in anyone’s best interest. When you sell your structured settlements, you are gaining access to your future structured settlement payments now so you can make the purchases you need and cover the costs without getting into debt.
This is significantly different from a mortgage loan, where you will need to prove to the bank that you can cover the cost of your loan, with interest, via a source of income. If you were dealing with a personal injury lawsuit due to a debilitating injury and are no longer able to work, the bank will see you as a credit risk and be unlikely to grant your borrowing request.
You will also need to show the bank or financial institution that you have a good credit score. If you do not have good credit, the bank will either reject your application or impose exorbitantly high-interest rates, which could dramatically increase the amount you will be expected to pay in purchasing your home.
However, when you sell your structured settlement payments, you do not need to worry about having good credit, proving that you have a way to pay back the loan, or providing us with credit references. as long as you have regularly scheduled structured settlement payments coming in, you may be able to sell them to our loan specialists at High Rise Financial.
Benefits of Selling Your Structured Settlement Payments
There are many benefits that come with selling your structured settlement payments. Some of the most notable of which include:
- The ability to obtain a portion of your future structured settlement payments in one lump sum
- The opportunity to find financial relief when you are struggling financially
- The opportunity to purchase your home without the risk of being victim to loan sharks
With structured settlement payments, it could be years before you have the amount of money you need to purchase your home. However, if you sell a portion of these future payments, you can get the home you have been hoping for without having to get into further debt or jump through hoops for predatory financial institutions.
How to Apply
When you are ready to sell your structured settlements, you will need to do so by filling out our application. The application process is simple.
Make sure you have the documents you need to complete an application in full and provide us with the information we need to verify your income and structured settlement payment, your pending lawsuit, and your attorney’s contact details.
We will review your application, speak to your attorney, and determine how much we can authorize in legal funding before sending the money to your account in a matter of hours.
Get Help from High Rise Financial Today
When you are having trouble making ends meet and need financial support now, accessing a portion of your structured settlement in advance could make all the difference.
Although you may not be able to take out a loan against your structured settlement, you do have the option of obtaining a lawsuit loan or selling your structured settlement payments. Find out which options are best suited for you when you contact High Rise Financial for help today. You can reach out to our office with questions or fill out our application now.