From 2017 to 2018, the structured settlement market increased by 8.45%. As more people are owning these settlements, some are wondering how they can turn their scheduled payments into quick cash. If unexpected expenses come up, can you get a loan from your settlement?

Read on to learn about loans for structured settlements and how they work.

Loans for Structured Settlements

Technically speaking, you cannot get a loan against your future structured settlement payments. People tend to look for this option as a way to get cash advances when they need it most. However, loans aren’t actually offered.

Businesses will advertise these loans for structured settlements online when they are actually looking to buy your future payments. This means the owner of the structured settlement can sell some or all of their expected payments for a reduced rate in exchange for cash advances.

You don’t have to have a high credit score because this is not a loan. No money gets borrowed and there is not a schedule of repayments or charged interest. Instead, you are making a sale ad will stop getting the regular income you had before.

The only way to keep getting money from your settlement is by sticking to the payment schedule or selling all or part of your payments. Selling all or part of your structured settlement payments should only be done when you need instant cash. For example, if you have debt, medical bills, or an emergency payment you need to pay off, selling your part could help you out.

However, keeping your payments to yourself will be more beneficial in the long run. Be wary of a company that tells you it will give you a structured settlement loan because they are misinterpreting their intention. These are people you don’t want to do business with.

Using Your Structured Settlement as Collateral

Collateral can only be used to secure a loan. Because loans for structured settlements don’t exist, most banks won’t accept the settlement as collateral. It is also important to note that these settlements are intended to compensate for an injury rather than provide income.

Other Ways to Get Income

If you were looking for loans for structured settlements because you need a more steady stream of income, there are other things you can try. Annuities are contracts between an insurance company and you in which you can make payments or pay a sum to receive regular disbursements in turn. These payments can begin right away or sometime down the line.

This type of income is usually asked for during retirement, but annuities can be tailored to a buyer’s needs. Annuity payments get received during a time frame of your choosing. Three common types of annuities can be found at

Don’t Get Caught in a Scam

Since loans for structured settlements are not real loans, it is important not to get caught in a scam with a company that claims they can provide you with one. If you need money fast, you can sell some or all of your payments to a reputable company. If you are looking for a more steady source of income, try looking at annuities.

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