Purchasing a structured settlement annuity is an attractive option for several investors. The amount of return on these investments makes this a very profitable option for those who are willing to wait for or take action in order to receive a return.
As good as this may initially seem, there is more to the process than it sounds. Therefore, here are a few tips that potential investors may want to consider that can save them time, and ultimately money.
How to Find Potential Investments
There are more than a few ways that individuals can find structured settlement annuities to purchase. They may elect to do a search of court records for cases in which money was awarded, as these are public records, in order to contact the individual or entity awarded a settlement.
Another option is to obtain a broker or utilize the services of an attorney that has experience in this area of law. Utilizing the services of a lawyer may be best due to the fact that a purchase agreement will need to be drawn up. In some cases, the attorney may serve as a broker. Purchasing an annuity requires more work than simply exchanging the money and waiting for a profit.
Understanding the Fees
There are fees involved when purchasing structured settlements. These fees often pertain to court costs and appropriate documentation. Unless litigation is involved, these fees may be a flat rate. If the investor begins collection procedures, this is also an added expense.
Regardless, the rates for any and all of these services will differ from one attorney to the next. In addition to this, there will also be additional taxes on this type of income. Special tax laws pertain to these settlements, and it may be more feasible to obtain payments, rather than receive the return in one lump sum. This will vary by individual circumstances and the goal of the investor.
First-time investors and even seasoned investors may wish to turn to the services of a lawyer when purchasing settlements. Not only can an attorney help with the paperwork that must be filed within the courts, but they can assist in several other aspects of the process. For example, they can help with the collection and tax side of things. Those that are not familiar with these tax laws and collections may find that while profitable, purchasing a structured settlement annuity can easily turn into an expensive hassle.