Alternatives to Selling Your Structured Settlement Payments

Options when you need money or have money problems:

• Debt relief / Dealing with debt / Having trouble paying your bills:

  • Debt Negotiation: If you have a lump sum of money (lump sum payment) coming due in a few months from your structured settlement, work with your creditors to cut you some slack. There is no reason you need to take a loss to pay a bill under such circumstances. Perhaps you can agree to pay a small amount of interest for a short delay in making payment so that you don't have to sell payments. Giving the creditor a date when the amount will be paid can help.
    
    
  • Credit counseling: Local bank or credit union may provide counseling for free.
    See: Federal Trade Commission (FTC): Choosing a Credit Counselor
    (The FTC tries to prevent fraud, deception and unfair business practices.)
    
    
  • Debt Consolidation / Bill Consolidation: Combine what you owe to others into a single loan with a goal to save money by getting a lower interest rate and possibly a lower monthly payment.
    
    
  • Debt Management Plan (DMP): Debt management company works out a payment plan to repay what you owe possibly at a lower interest rate with a lower monthly payment. It is a voluntary agreement between you, the debt management company, and the people you owe money. You send a payment to the debt management company and they pay the people you owe. It may have a negative impact on your credit report. Typically, you will have to stop using credit cards. The debt management company will charge you a fee. (Not all debt management companies are reputable so you would need to research to find a good company.)
    
    
  • Debt Settlement: An agreement between you and your creditors (the people you owe money to) where the amount you owe is reduced. Once this reduced amount has been paid, it is considered paid in full. It will have a negative impact on your credit report.
    
    
  • Bankruptcy: Assets are sold to partially pay the money that is owed. You get to start over but with a negative impact on your credit history / score. (Structured settlement payments can be at risk with this option. Avoid if possible.)
    
    
    
  • Do it yourself:
    If you owe money: ask to set up a repayment plan, ask to waive fees, buy some time / find a way to delay paying without penalties, ask for lower interest rate, ask for lower monthly payment. Create a budget for yourself.
    
    

    Almost everything is negotiable even if there is a contract. It's a matter of finding the right person to ask and knowing how to ask for it.

    
    
    
    

• Government Benefits

  • Research to find if something is available for your situation. Check benefits.gov and benefit finder, etc.
    
    
  • Human services, social services. Dial 211 in many areas for free service to find local resources.
  
  
  
  

• Work

  • Find a higher paying job / ask for a raise.
    
    
  • Find a second job / part-time job.
    
    
  • Retraining
  
  
  
  

• Sell

  • Sell assets to raise money
    
    
  • Cash in retirement plan / pension plan. (Penalties are typically accessed which can make this a bad option.)
    
    
  • Life settlement from life insurance policy. Companies may pay you money for your life insurance policy. (May not be a good option but very dependent on individual circumstances.)
  
  
  
  

• Loans

  • Credit repair: Research "credit repair" before applying for a loan. Repairing your credit can help increase your credit score and get you better rates / terms for a loan.
    
    With loans, get the lowest interest rate you can. If there is an introductory interest rate, have a plan in place for what to do when the introductory time is up. Be sure to consider loan fees, origination fees, etc. when comparing interest rates and overall costs.
    
    Some loan options may not be available to all people and many are subject to credit history.

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  • Loan from family or friends
    
    
  • Personal loan from credit union or local bank. Personal loans with an interest rate in the 6% range are possible with good credit.
    
    
  • Home equity loan and Home equity line of credit (HELOC) usually have low interest rates (around 4.5% with good credit) and tax advantages. Your home is used as collateral and could be lost if you don't make payments. Check for application fees and closing costs.
    
    
  • Credit card / 0% APR balance transfer for 18 months (most are for 10 to 12 months). Even though the interest rate is 0%, these types of balance transfers usually have a 3% fee (or higher) that you are charged at the beginning of the transfer.
    
    
  • Credit card that has 0% interest rate for purchases. Typically, rate is good for one year or less and then jumps up to a high interest rate.
    
    
  • Credit card cash advance. (Typically, not a good option due to high interest rates.)
    
    
  • Find someone to cosign a loan with you. (The cosigner needs to fully understand the problems / consequences that can occur if payments are not made on time.)
    
    
  • Loan from 401k / retirement account. (Penalties and potential tax liability may make this a bad option.)
    
    
  • Loan from whole life insurance policy
    
    
  • Peer to peer loan / person to person loan without a bank. Individual investors lend their own money to borrowers at an agreed upon interest rate.
    
    
  • Loan secured by assets - Things that you own that have value can be used as collateral to obtain a loan.
    
    
  • Securities backed line of credit - Use your securities (stocks, bonds, mutual funds) as collateral to get a loan / line of credit.
    
    
  • Bank overdraft (Typically, not a good option due to high interest rates.)
    
    
  • Loans for veterans
    
    
  • Home improvement loan
    
    
  • Debt consolidation loan
    
    
  • Government loans - Including: student loans, housing loans (home improvement and disaster relief), business loans, veteran loans ... see the U.S. government site: GovLoans.gov
    
    
  • Depending on the interest rates, payday loans, car title loans, pawn shop loans or any type of loan with a high interest rate may not be a good option.
  
  
  
  

• Refinance Existing Loans

  • You can refinance many types of loans. Basically, you replace the original loan with a new loan at a better interest rate and possibly lower payments.
    

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  • Refinance home mortgage / Cash-out refinance mortgage
    
    
  • Refinance student loan
    
    
  • Refinance high interest loans / credit cards to a lower interest rate or ask for your interest rate to be lowered.
    
    
  • Refinance auto
  
  
  
  

• Ask for Money

  • Donations
    
    
  • Crowdfunding: Average successful crowdfunding campaign is around $7,000
    
    
  • Ask for donations: items you can sell and have a yard sale / rummage sale / charity auction.
  
  
  
  

• Ask for Help

  • Ask for help from someone you know or a local group / community / church etc. They may be able to help you or know someone who can help.
  
  
  
  

• Save Money

  • Save money / reduce spending on other things / use saved money on your needs.
  
  
  
  

• Buying

  • Buy what you need not what you want. Buy less.
    
    
  • If needing to buy something ask seller about owner financing and possibly delaying payments till a later time.
  
  
  
  

• Money Management

  • Get the most out of your money: budgeting, saving, investing, buying
    
    
  • Research money management and money management mistakes
  
  
  
  

• Fundraising

  • Research fundraising ideas for individuals / personal fundraising ideas.

If you need money for:

• Medical Expenses

  • A "charity care" program or a way of providing free or reduced prices may be available at your hospital or medical facility.
    
    
  • Health Resources and Services Administration (HRSA), Health Centers care for you, even if you don't have health insurance. You pay what you can afford based on your income. Find a health center.
    
    
  • Negotiate a better price / lower rate with healthcare provider.
    
    
  • Finance the expenses, see loans above.
    
    
  • Compare / look at different health insurance policy.
  
  
  
  

• Education

  • Scholarships
    
    
  • Grants
    
    
  • Student loans
    
    
  • Loan forgiveness
    
    
  • Self-help / self-learning
  
  
  
  

• Start a business / get money for a business

  • Microlending / microloans
    
    
  • Business grants
    
    
  • Small business loans
    
    
  • Small Business Administration (SBA) Loan
    
    
  • Crowdfunding
    
    
  • Find a business partner
    
    
  • Small Business Development Centers (SBDCs): provide assistance to small businesses
  
  
  
  

• Transportation

  • Borrow a car / share a ride
    
    
  • Check city transportation options
    
    
  • Consider buying a used car / look for reliable model / have mechanic check it / vehicle history reports
    Federal Trade Commission (FTC):   Buying a Used Car
  
  
  
  

• Home:

  • New Home:
    
    
    • First-time homebuyer programs and grants
      
      
    • FHA loan
      
      
    • USDA Single Family Housing Guaranteed Loan Program
      
      
    • Contact local public housing agency (PHA)
      
      
    • Department of Housing and Urban Development (HUD)
    
    
    
  • Improve Existing Home:
    
    
    • Home improvement loan
    
    
    
  • Mortgage Assistance:
    
    
    • Need mortgage help? Making Home Affordable.gov
    
    
    
  • Foreclosure:
    
    
    • Basics about avoiding and handling foreclosures from usa.gov
    
    
    
    

• Bills:

  • Help with bills from usa.gov is a good source.