by Structured Settlement Watchdog
The false advertising of "cash now for structured settlements", by factoring companies has been prevalent for many years. That's how they suck people in. Structured settlement protection acts that are in place to help assure that the consumer is not take advantage of by the unscrupulous, also assure that such process will never take place in an instant, or even a couple of weeks.
It is important to point out that some companies do actually pay some amount of cash within 4 days to a week, however such payments are a cash advance, typically a non recourse loan against what is hoped to be an eventual approval of the structured settlement factoring transaction by a court of competent jurisdiction. A reliable representative of one such company has told this author that the maximum amount it will advance is $5,000. Hardly a windfall, but it could help make a mortgage payment for those who have exhausted all other options.
Anyone considering such cash advance should get a clear up front disclosure about the cost of money (i.e. it's not going to be as cheap as your ATM fee!) and avoid it if possible.
In the event that a factoring company funds a "structured settlement buyout" without Court approval of the transfer, the factoring company could be subject to a 40% excise tax on the factoring discount.
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