March 4, 2008
With the rising costs at the gas pumps, grocery stores, and other consumer outlets, structured settlement recipients are finding themselves contacting factoring companies in order to relieve some of the financial pressures of today’s market. While this may seem like a quick fix to any financial problem a tort victim may encounter, factoring a structured settlement will not help the annuitant over the long haul.
Many Settlement Professionals will argue that structured settlements are designed to withstand increases in inflation. Structured settlements can have built in mechanisms that provide yearly increases to help with the costs of inflation. 3% is the normal yearly increase.
While a 3% increase seems like a significant amount……..this increase does not allow a tort victim or an individual living on a fixed income to live a normal life. The difference in price between a gallon of gasoline in March of 2007 ($2.27) and March of 2008 ($3.33) is over $1.00 per gallon. If a tort victim needs to fill-up their gas tank (15 gallons) once per week, the 3% increase will be spent on gasoline for their automobile every month. Not to mention that a gallon of gasoline is expected to increase to $4.00 per gallon by summer time.
Where does the money for the rising costs of food, electricity, water, and heat come from? Individuals are now turning to factoring companies to cash in their structured settlement in order to pay for normal living expenses.
This author believes that factoring a structured settlement is not the solution. Times are difficult for everyone, especially for individuals on a fixed income, but there are ways to work around this recession and keep a structured settlement in tact.
Here are a few money saving tips:
- park your car and take public transportation (eliminate fuel and insurance costs)
- cut out coupons before going grocery shopping
- cook your meals (eliminate any dining out)
- cancel any subscriptions to magazines, websites, or any other non essential need
If you have any questions or would like to leave a tip, please comment below.
February 28, 2008
Here is a snippet of J.G Wentworth’s recent press release:
- Do your research on firms that can purchase your structured settlement to ensure they have a reputation of offering fair value.
- Do not take the first offer to purchase your policy, but shop around to get the most value for your structured settlement.
- Depending on your financial needs, decide on whether you need to sell your entire structured settlement or just part of it.
- Consult with an attorney to make sure you understand and document any tax ramifications.
- Think about your financial needs going forward and how selling all or part of your structured settlement may impact your income later.
It is important that companies start to recognize the education that consumers need in order to improve the structured settlement factoring industry. It is good to see that JGW has taken a step in the right direction. Other companies need to step forward and realize that large profit margins are not the way into the future.
This press release points out that tort victims need to create competition between factoring companies in order to receive the best deal.
February 19, 2008
A New York Judge denied one of Senecaone’s affiliate companies from completing a structured settlement factoring transaction where Brian K. Ciemielewski was trying to sell a $100,000 payment paid out in 2024 for the amount of $10,000.
“Quite frankly, this purported deal speaks for itself,” Judge Lebous wrote in his ruling. “This court will not approve a payment of $10,000 in exchange for 10 times that amount in future payments of $100,000. Based on the foregoing, the court finds said transaction is not fair and reasonable….Quite simply, this court finds the transaction is not in Mr. Ciemielewski’s best interest.”
This proposed deal put forth by Senecaone is an example of a factoring company preying on a tort victim. Cases like this give the factoring industry a bad reputation.
What makes an individual sell future payments of $100,000 for $10,000?
Desperate times call for desperate measures, but what Mr. Ciemielewski failed to realize is that there are better offers than that of Senecaone’s offer. Mr.Ciemielewski had previously sold $75,000 worth of settlement payments in two separate factoring transactions for the amount of $36,400 to JG Wentworth and Symetra Assigned Benefits.
Without knowing the details of the transaction, it is hard to say the reasoning behind Mr. Ciemielewski’s decision.
February 13, 2008
It has come to this authors attention that consumers are having a difficult time factoring settlement payments where the original payee was Executive Life of New York. Several individuals have contacted us complaining of companies dropping their entire case days before the court date.
Settlement Quotes has been able to locate a few investors that are willing to purchase Executive Life Insurance of New York payments which are currently being payed out by Metropolitan Life (MetLife). Feel free to contact us to receive more information.
February 7, 2008
The following statement: “it is more expensive to sell less,” when referring to a structured settlement factoring transaction is true when speaking in structured settlement factoring language. The pricing structure of the factoring market uses discount rates as a scale to determine the cost to the annuitant or tort victim. There are several reasons that it may appear to be more expensive to sell less of your structured settlement.
Every structured settlement factoring transaction has standard costs associated with it. Below is a pie chart outlining these costs:
- Filing fees and court costs range from $2300- $2800 depending on the state
- Insurance transfer costs range from $500- $800 depending on insurance company and double if the payments are split
- Miscellaneous fees usually range from $150- $175
- Lien search costs are $300 (to make sure that the annuitant does not owe taxes, child support etc.)
- Fedex costs $50
These standard costs are present on every structured settlement factoring transaction whether the tort victim is selling a present day value annuity of $10K or whether they are selling an annuity with a present day value of $100K. The discount rates of the annuity are effected by the amount of costs to complete the transaction. The graph below illustrates the scenario.
As you can see the larger the present day value of the annuity, the lower the discount rate of the transaction equates to.
This scenario is an example of how the discount rates are effected by the standard costs of a factoring transaction. Settlement Quotes does NOT suggest to sell more structured settlement payments to reduce the discount rate of the transaction.
This blog post is to help tort victims and other financial professionals understand the relationship between the present day value of an annuity and the discount rates of a transaction. If you have any questions or concerns, please comment below and if you would like to learn more about structured settlement factoring click here.
“They charge customers extremely high rates 19.99 is the MINIMUM that they will do a transaction for, unless a manager approves something lower (which is rare). Other companies will charge much lower rates and get you more money almost every single time.”
The above quote came directly from an ex employee of Peachtree Settlement Funding on this article from Rip Off Report. How does a company who has rates of 19.99% continue to thrive in todays structured settlement factoring market?
Attention: Tort victims who are selling structured settlement payments, DO NOT GO TO PEACHTREE SETTLEMENT FUNDING! You can receive a better quote be talking to any other company in the factoring market. The difference between the 19.99% and a 10% discount rate could mean tens of thousands of dollars for you and your family. Do yourself a favor and get a second opinion before signing any documents with this company.
This company is able to offer these types of rates due to uncompetitive lead generation from both television and internet advertisements. While annuitants will most likely receive a second opinion on the internet, most television victims will not shop around for another quote. This is unfortunate for both tort victims and the structured settlement factoring industry.
Peachtree Settlement Funding needs to step up and set a better example. These types of rates were seen in years past but are slowly dwindling. It is sad to see a company that can still get away with horrible discount rates like those of Peachtree Settlement.
February 5, 2008
Settlement Quotes issued a press release today announcing the official start to our online portal- Structured Settlement Factoring Company Launches Online Market Place to Sell Structured Settlement Payments.
This press release was also indirectly aimed at the settlement planners, brokers, lawyers, and other financial professionals who have a client that is out of other options and needs to factor settlement payments. Why not get a second quote from a different source?
January 22, 2008
Settlement Quotes is a funding brokerage firm providing services in the following areas:
Settlement Quotes is not a direct purchaser of these payment steams. We work hand in hand with several funding companies which process and fund these types of transactions. We are able to provide better quotes to the payment steam owner if they come to us than if they were to go to these funding companies directly. Why? These funding companies make money by funding payment streams with as little money as possible.
Settlement Quotes makes sure these funding companies make as little profit as possible. Don’t believe us, request a quote, and let us show you!
January 21, 2008
John Darer wrote an interesting post NSSTA versus the Rogues of Factoring, while I don’t agree with the interesting video Mr. Darer showed in his post, I do agree with the symbolism. While Mr. Darer is battling the structured settlement brokers who are taking commissions on factoring transactions, other thoughts came to mind while reading his post. Where is the structured settlement factoring education? Where does an annuitant or a structured settlement broker go to find information about structured settlement factoring?
Mr. Darer does an excellent job at educating the public about the structured settlement industry and secondary markets, but his opinion is only 1 opinion. The NSSTA does a great job at educating structured settlement brokers and settlement planners, but where is the factoring industries equivalent to the NSSTA? Annuitants who are thinking about selling (transferring) their payment rights need somewhere to go.
Settlement Quotes is planning to build a website for structured settlement brokers, settlement planners, annuitants and factoring companies to turn to as an education and information portal. This author hopes several writers will help to expand this website into a community forum.
All financial professionals will be able to gain access to the administration panel allowing you to submit articles and discussions for the factoring community to view and respond to.
If you would like to discuss this more, please feel free to comment or email me at acravenho (@) structuredsettlement-quotes.com
January 3, 2008
It appears a few factoring companies have dropped off the scene after making a strong appearance for a few months. Washington Square Financial, Woodbridge Investments, and Freedom Financial Solutions were all listed in the pay per click ads on the major search engines throughout the months of September, October, and November. These companies are no longer listed on the pay per click ad sections. Is this temporary?
Washington Square Financial management and owners were previously connected to Peachtree Settlement Funding. This company was listed everywhere in the pay per click ads. For the last two weeks WSF is no where to be scene.
Woodbridge Investments is another company who is no longer on the paid ad section of the search engines. This company is making a push in the organic section of the search engines though. Woodbridge Investments states on their homepage that they buy structured settlements and annuities. Sources tell this author that Woodbridge Investments is a factoring broker and not a direct buyer.
If you have any information on this story please feel free to comment.
Woodbridge Investments is another structured settlement factoring company that made a strong appearance a few mont
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