If you have succeeded in obtaining "structured settlement loans," congrats! And I'd be eager to exchange notes with you.
During all my years in structured settlements I have heard of very few cases of loans given by banks against structured settlements as a collateral.
Which isn't to say that it can't be, or it never happens. It is just very rare and unlikely.
If you were ever suggested otherwise by a structured settlement buyer promising you to get a "structured settlement loan," please comment here and share your experience with us.
A bank would hardly agree to give you a loan against a structured settlement, and here's why:
Banks simply aren't interested in the time and money expenditures, the trouble and headaches involved in the process. Banks have other business to do.
This said, if you do find a bank willing to go the extra length and lend you the money, then structured settlement loans may be valuable especially for investors.
Let's say you are an investor or factoring company and want to invest in a structured settlement by buying it out from the original holder in exchange for a lump sum, but you don't have, or don't want to spend the full amount of the lump sum, what you can do is take out a structured settlement loan.
For example: you want to buy a structured settlement for $100,000 as a lump sum. You only want to spend $20,000 as a down payment. You can take out a loan for the rest with the structured settlement as a collateral.
This way, you only have to spend 1/5 of the amount, and the rest is funded by the bank.
You will have to repay the loan plus interest, but you'll afford it and make a profit since you buy the structured settlement at a discount and earn MORE than the interest you'll pay to the bank.
Furthermore, on the part of the down payment, all the profit is yours and you don't pay anything to the bank.
As said, all this is in case you can find a bank ready to lend you money against a structured settlement, which is extremely rare. Nonetheless, once a bank does agree, it may be easier than getting a regular loan, since the structured settlement is viewed as a fairly safe asset for the bank to claim in case you default and fail to repay the loan.