We evaluated 21 structured settlement companies and found the top four choices after carefully considering a variety of factors including costs, customer experience, buyout options, the speed of transactions and company reputation. The four best structured settlement companies are Peachtree Financial Solutions, Stone Street Capital, Fairfield Funding and J.G. Wentworth. In this guide, we will review essential information about structured settlements and structured settlement buyouts along with detailed information about each of our top company picks.
Top Structured Settlement Tips:
- Seek legal counsel before searching for a structured settlement company
- Get quotes from at least three structured settlement companies
- You must repay cash advances if the buyout agreement falls through
Tips for a Wise Structured Settlement Buyer
A structured settlement is a legal settlement resulting in tax-free payments from an annuity to the plaintiff over time. If you find yourself the recipient of a structured settlement and you prefer a lump-sum payment, a structured settlement company can buy out all or part of the contract and give you cash up front. You will pay a fee for this service, so you’ll have to weigh whether the cost of selling all or a part of your settlement balances your need for one large payment.
While a structured settlement can be ideal for ongoing income, there are times a lump-sum payment is preferable, often to pay medical or other bills, or to make home modifications to age in place or adjust to a chronic condition. Those who invest in stocks, gold IRAs and other financial instruments often use a structured settlement company to swap out the fixed-income annuity the settlements are held in for a higher return on investment.
Meet with a legal or financial professional before selling a structured settlement to understand tax and other implications. You need to know if any other entity could have legal access to funds from the sale. For example, an insurance company that paid benefits for medical treatments for injuries resulting in a medical or personal injury structured settlement could seek reimbursement from a lump sum payout.
How to Choose a Structured Settlement Company
Take time to look into your options and don’t be lured into immediately signing up with a structured settlement company offering payment in a week or two. It’s usually better to work with a company that will pay you more for your settlement in three months than one that will pay significantly less much sooner.
Three other considerations are paramount to choosing a structured settlement company: customer service, denial rate and total dollars purchased.
Customer Service
The structured settlement sale process is complicated. It’s essential to find a structured settlement company with reliable customer service providing complete information in a format you understand. Consider the following to determine the level of customer service:– Is the company open for extended hours each day? Flexible hours allow you to discuss your private finances at a convenient time.
– Can you communicate via email or chat? It’s beneficial to have a written record of conversations if you have complicated problems or questions.
– Do you work with one representative, a team, or different people every time you make contact? Working with someone who knows your structured settlement buyout case means you don’t have to explain the same details over and over.
Denial Rate
A judge will deny a proposed structured settlement sale if the circumstances do not result in a deal that’s in your best interest. A structured settlement company’s denial rate is the percentage, or the total number of proposed settlement purchases declined by a judge. If the company doesn’t publish this information or provide it when you ask, walk away.Total Dollars Purchased
The total dollars purchased is the entire value of structured settlements a company has acquired. The higher the number, the more buyouts have been approved by judges. The value of total dollars purchased is a reliable indicator that the structured settlement company will be a good option for getting quotes.
Broker vs. Direct Funded Structured Settlement Companies
There are two types of structured settlement companies: brokers and direct-funded agencies. A structured settlement broker will help a company to buy out your settlement and usually receives payment for services from the buyer, but sometimes you pay for that service. A direct-funded agency will buy all or a portion of your structured settlement from you, doesn’t seek out a buyer on your behalf and may or may not charge a lower fee than a broker.
Understand the type of structured settlement company.
Which is the better structured settlement company, a broker or direct-funded agency? You have to shop around to find which works best for your circumstances.
Structured Settlement Discount Rates
Offers you receive for buying your structured settlement can vary widely between companies, and many factors go into determining how much a structured settlement company will pay you.
Part of the payout calculation is based on the discount rate, which is a percentage of the total settlement amount. Typical discount rates range from 7% to 29%, and this rate is negotiable. The company buying your structured settlement will also give you the effective rate, which includes the discount rate, fees and other costs associated with the agreement.
| Structured Settlement Buyout Proceeds Before Fees | |||
|---|---|---|---|
| Settlement Amount | 10% Discount Rates | 18% Discount Rates | 25% Discount Rates |
| $250,000 | $225,000 | $205,000 | $187,500 |
| $500,000 | $450,000 | $410,000 | $375,000 |
| $750,000 | $675,000 | $615,000 | $562,500 |
| $1,000,000 | $900,000 | $820,000 | $750,000 |
| $5 million | $4.5 million | $4.1 million | $3.75 million |
Structured Settlement Company Fees
Shop around for the best price for your structured
settlement with the lowest fees.
Another set of factors to consider when selling your structured settlement are fees. The company buying your settlement will typically remove these costs from your payment, but policies vary by situation and between companies.
- Court Costs: There is a fee to pay the judge and court costs during the approval process.
- Brokerage Fees: The structured settlement buyout company may be a financial instrument broker or hire an outside broker. Either way, the cost will likely be passed on to you.
- Administrative Fees: Filing paperwork, recording documents, legal fees, surrender fees, and other costs considered administrative expenses.
Our Search for the Best Structured Settlement Companies
1. We searched through a detailed list of structured settlement purchase companies.
2. We evaluated these structured settlement companies based on our expert selected research points: cost, customer service, and company reputation.
3. We narrowed the list and presented the resulting four structured settlement companies to you.
There are hundreds of companies advertising structured settlement buyouts, but we did the time-consuming research for you. Our in-depth look into structured settlement companies includes reputation, price, customer service, and other factors. We reviewed a wide range of these companies, then considered which of those on our list stood out in each of four categories.
Structured Settlement Company Reviews
After our evaluation, we chose the four best structured settlement purchase companies: Peachtree Financial Solutions, Stone Street Capital, Fairfield Funding and J.G. Wentworth.
- Great Online Information
- Website offers a wealth of easy-to-understand information
- Great Experience
- Top level management is among the most experienced in the industry
- Most Flexability
- Provides several alternatives for buying structured settlement payments
- Great Customer Service
- Reputation for honesty backed by an excellent customer guarantee
Peachtree Financial Solutions Review
Great Online Information |
Source: Peachtree Financial Solutions
Peachtree Financial Services purchases structured settlements directly and provides funding to other firms for structured settlement buyouts. You will find a great deal of information about the structured settlement buyout process on the company website. When you do business with Peachtree Financial, one representative works with your case through the entire process. This policy prevents confusion and errors that can happen when dealing with multiple reps.
Peachtree Financial Services spells out a pledge to customers called the Peachtree Promise. Your dedicated representative will listen to learn your situation, use understandable language to discuss your structured settlement buyout options, and will work with you at a comfortable pace and not rush any decisions.
Stone Street Capital Review
Great Experience |
Source: StoneStreet Capital
Stone Street Capital is one of the largest structured settlement companies, and with 25 years in business, this is one of the first companies to offer structured settlement buyouts. Stone Street Capital senior management team members are among the most highly experienced across all structured settlement companies.
Aside from providing direct buy services for structured settlements, Stone Street Capital pays a lump sum for annuities, lottery and some gambling jackpot contracts. The company offers one-on-one consultations via phone, chat and email. Receiving cash can take from 45 to 90 days, depending on your state laws but Stone Street Capital provides a cash advance option.
Fairfield Funding Review
Great Customer Service |
Fairfield Funding is a smaller organization compared to most other structured settlement companies, which lends the opportunity for more personal service experience. Fairfield employs only financial professionals and has a reputation for being completely upfront about structured settlement fees. Fairfield Funding’s website offers a series of informational videos about the company and structured settlement buyouts, although it’s not always easy to navigate.
The Fairfield 100% Guarantee gives customers the lowest price, cash in five days, no-interest cash advances and fast transactions. Fairfield pays legal, notary, processing and other fees.
J.G. Wentworth Review
Most Flexible |
Source: J.G. Wentworth
J.G. Wentworth is one of the most recognized names in structured settlement purchases along with other financial products like annuities and mortgages. The company funded over $10 billion in loans to date. The J.G. Wentworth website likely provides all the information you need to get started with selling a structured settlement, like an outline of the sales process, how to prepare for your court date and addresses some of the myths about structured settlement buyouts.
J.G. Wentworth is very flexible with organizing structured settlement buyouts. The company will buy all or part of the settlement, a certain number of payments, or part of each monthly payment for a specified length of time. J.G. Wentworth also buys life contingent annuities and can provide cash using a buyout that works with your needs without sacrificing your entire settlement.
District Settlement Finance Review
Great Personalized Service |
Source: District Settlement Finance
Direct Settlement Finance is a small firm offering personalized service to customers who want to sell a structured settlement, no matter the size. They work with all types of annuities and can convert lottery, casino and sweepstakes winnings into cash distributions.
The experts at Direct Settlement will help guide you through the legal aspects of selling a settlement. With their process, you’ll get a check within a few weeks, or they can route money directly to your bank. Working with a smaller firm usually ensures better customer service, but it also means you can keep more of your money because they charge fewer fees.
Related Structured Settlement Resources
Readers of this Structured Settlement guide also found these related articles helpful.
How to Sell Your Annuity
If you are in financial trouble, selling your annuity may be a viable option. When considering your financial options take the time to consult a financial advisor.
Frequently Asked Questions
Will I owe taxes if I sell my structured settlement?
There are currently no taxes on the payout from selling a structured settlement, but receiving a large lump sum payment could push you into a higher income tax bracket.
Can I sell my structured settlement while going through a divorce?
Your state’s community property or equitable distribution laws likely prevent you from selling a structured settlement during a divorce but consult with legal counsel to get the final word.
Why would I sell only part of my structured settlement?
Most companies will buy a part of your structured settlement or a portion of each payment you receive. This agreement gives you cash upfront while maintaining an ongoing cash flow at a lower rate.
What is the Present Value of a structured settlement?
Present Value (PV) is a financial formula calculating today’s value of money to be received in the future. The PV is part of what determines the amount a structured settlement company offers to pay for your settlement and must be disclosed to you.
Can I cancel a structured settlement buyout if I change my mind?
The U.S. Consumer Financial Protection Bureau advises you can cancel a structured settlement buyout agreement even after you sign the contract, but only within a specific time frame. Do not accept a structured settlement buyout offer without getting your cancellation rights in writing and reading and understanding the policy.
Concluding Thoughts on Structured Settlements
Bottom Line:
Get multiple buyout quotes from structured settlement companies and consider enlisting in the help of a financial or legal professional before selling a structured settlement.
Structured settlements provide guaranteed income over time, but you may need cash from the settlement sooner. Compare our picks for the best structured settlement companies to find a deal offering you a lump-sum payment at a reasonable cost.
The Best Structured Settlement Companies
| Structured Settlement Companies | Best For | |
|---|---|---|
| 1 | District Settlement Finance | Great Customer Service |
| 2 | Fairfield Funding | Great Personalized Service |
| 3 | J.G. Wentworth | Most Flexibility |
| 4 | Stone Street Capital | Great Experience |
| 5 | Peachtree Financial Solutions | Great Online Information |