Massachusetts Structured Settlements
Structured settlements are tax-free payments made on a regular basis after a lawsuit is won or settled. Typical types of lawsuits that result in structured settlements include personal injury cases, medical malpractice, wrongful death, and workers compensation matters.
What is a Structured Settlement?
When someone is engaged in a lawsuit, they may be entitled to a potentially large judgment if they win. However, the parties will typically negotiate a settlement agreement, which will terminate the lawsuit and usually obligate the defendant to pay the plaintiff a sum of money. If this sum is small, it will usually be paid in one lump sum. However, if the settlement is large, then the parties may agree on a structured settlement, which would guarantee the plaintiff a set of fixed future payments over a certain amount of time. These future payments are essentially an annuity that is paid out over time from the annuity issuer, which is typically an insurance company or life insurance company.
As previously mentioned, one positive feature of a structured settlement is that it provides a reliable source of income payout over a set period of time. For example, if someone is injured in a car accident and will require long-term medical care, this payment stream will help to cover those ongoing costs. In that sense, the recipient of a structured settlement can have comfort in knowing that money has been set aside for their medical expenses and they won’t be as much of a burden moving forward
Sometimes in the case of class lawsuits or lawsuits with multiple plaintiffs, a qualified settlement fund (or QSF) will be created, which is a type trust that allows for a more straightforward and organized administration of a lawsuit settlement.
Sell a Structured Settlement
There are times when the owner of a structured settlement annuity would like to sell some or all of their remaining periodic payments in exchange for a lump sum of cash. This is usually for a variety of reasons: perhaps funds are needed for an unforeseen emergency, down payment on a home, or college tuition payments. So-called “factoring companies” are in the business of purchasing structured settlement payment rights and there are many of them out there.
The sale of a structured settlement can take various forms. For example, the seller can sell all future payments to the buyer in exchange for a lump sum. Or, the seller can only sell a portion of their payments either for the remainder of all remaining payments or just for a portion of those remaining payments. Essentially, it depends on how the seller is seeking to structure the deal.
In order for a factoring company to purchase a structured settlement, they will work with the potential seller to analyze the annuity contract and gather information before providing a quote. Next, if the quote is accepted, court approval will be required before the annuity is sold — this process can take several weeks. Court approval is required so that a judge can weigh the interests of the interested parties and claimants to ensure the deal is fair and in the best interest of the seller. It is not necessary to retain an attorney or law firm for the sale of a structured settlement, but that choice is at the seller’s discretion.
Specifically, Chapter 231C of the Massachusetts, entitled Transfers of structured settlement payment rights, governs the purchase of structured settlement payments. Most significantly, this section requires certain disclosures to payees and requires court approval for any transfer of payments. Much like many other states, the State of Massachusetts seeks to protect potential sellers from being taken advantage of. As such, it’s advisable to work with a factoring company that is well-versed in purchasing Massachusetts structured settlements.
While court approval is pending, many factoring companies will pay an advance to the seller and recoup that advance once the deal closes. This can help provide some financial relief to the seller while the sale is pending. After closing, the factoring company as the transferee will be entitled to receive the annuity payments and the seller will receive their lump sum payment.
When considering selling a structured settlement, the seller must consider all the consequences involved. For example, if they are reliant on the consistent payments to pay essential bills such as rent and utilities, then it may be risky to sell the structured settlement and risk not being able to meet their financial obligations.
Structured Settlement Companies in Massachusetts
Below is a list of factoring companies in Massachusetts who can help navigate the sale of a structured settlement and structured settlement consultants who can help with structured settlement planning.
Phone Number: (877) 547-3672
While AnnuityFreedom.net is not Massachusetts-based, we can help people in Boston, Worcester, Springfield, Cambridge, Lowell, Brockton, New Bedford, Lynn, Quincy, Fall River, and surrounding areas interested in free quotes or selling their settlement payment rights.
Ringler Associates, Inc.
1309 Beacon Street
Brookline, MA 02446
Atlas Settlement Group
11 Brae Burn Road
Newton, MA 02466
Arcadia Settlements Group
50 Margin Street
Cohasset, Massachusetts 02025
Law Firms Familiar with Structured Settlements
Law Office of Kenneth I. Kolpan, P.C.
26 Lillian Way
Wayland, MA 01778
Jeffrey Glassman Injury Lawyers
1 International Pl Unit 1810
Boston, MA 02110