Is Peachtree Settlement Funding Scam?

I’ve been hearing another round of obnoxious commercials on the radio again. This one is for Peachtree Settlement Funding, and they definitely play to the “I want it now” mentality of people.

With lines like:

It’s your money, and you should have it!

Why wait?

Get your money in one lump sum.

Life doesn’t wait, why should you?

It’s a compelling come-on. It’s also quite obnoxious due to the whiney voice of the guy who plays the customer, but such is life in the radio ad world I suppose.

As far as the ad itself goes, it makes many implied emotional pleas. For example, It’s your money, and you should have it! This is an example of sort of implied argument made throughout the ad, namely that someone else is unfairly keeping your money from you, and that Peachtree will right that wrong for you. The remaining 3 quotes all play to the sense of urgency and immediate gratification – you shouldn’t have to wait for your money.

So the ad is annoying and uses the sorts of advertising tools and techniques designed to convince the customer to use their service. That’s fine, no crime there. But are they a scam?

Let’s back up a bit first and look at what it is they offer.

What is structured settlement funding anyway?

A person can acquire a structured settlement when he wins a court case, the lottery or is the beneficiary of an annuity. All that means is that the person is entitled to a set amount of money on a regular basis for a specified amount of time. For example, if you win the lottery you may be entitled to $1,000 per month for the next 20 years.

That’s the concept behind a structured settlement annuity – a sum of money has been invested on the person’s behalf in exchange for regular payments. What a structured settlement purchaser like Peachtree does is to buy that annuity at a discount and provide the person with a one-time, lump sum payment.

So, is Peachtree Settlement Funding a scam?

To be honest, I don’t know. this guy clearly thinks they are. He claims to be a former employee of Peachtree, but who knows if that’s true. They do have an A+ rating from the Better Business Bureau, and much of what the “former employee” writes about are aggressive sales tactics.

But what about the underlying service? Is settlement funding worth the cost?

I suppose that depends on the cost. some things to consider about settlement funding:

• You will receive a substantially lower amount than what the settlement promised. This is because you are exchanging future value and interest payments for a larger sum (larger than the monthly payments) today. It will also be less due to whatever fees and costs are associated with the settlement company.

• Your monthly payments will be worth less over time. This is simply because the structured settlement is not likely to have a provision for indexing to inflation, so your dollar will be worth less in 15 years than it is today.

It’s a bit of a numbers game and will be different for every case, but for me it comes down to the cost of the settlement funding service. If there was no cost, or a nominal one, then I’d take the lump sum payment today and invest it to keep ahead of inflation. That’s all the insurance company that holds the structured settlement is doing anyway, but they keep the profit.

Related Posts:

• Is Debt Settlement a Good Idea?
• Tips to Avoid Foreclosure Scams!

Is Debt Settlement a Good Idea?

It’s a common scenario. You find yourself over your head in debt and see an offer like the one pictured here, promising to get you out of debt, fast and easy! Most debt settlement companies are little more than a scam.

The plan is that you enroll in the settlement service for a fee. You then pay the settlement company a monthly fee, with the understanding that the company will in turn, negotiate either a smaller payment or smaller overall amount to be repaid.

Unfortunately, many debt settlement companies tell you to stop communicating with and sending payments to your creditors while you make payments to them. This is, in effect, diverting your debt payments from your creditors and sending them to the settlement company.

This simply causes you to rack up interest and pile on late fees, all the while the settlement company collects a monthly payment.

So, is debt settlement a good idea? For most people, no. In the worst case, debt settlement is a scam. In most cases, debt settlement is just not a good idea.

The reason is that you can do for yourself what the settlement company promises. Call your creditors and negotiate. This is especially effective in the current economic climate. Creditors are taking huge losses, and will make meaningful compromises to get at least some of what you owe back. Tell them you simply cannot pay back what you owe, or at least not at the current monthly payments. Negotiate for a lower payment, or overall outstanding debt amount.

However, some people are so far gone that debt settlement is the only way to go. If you are one of these people, be sure to find a nonprofit credit counselor through National Foundation for Credit Counseling. Their services might be free, but they should cost no more than $25 enrollment and $50 monthly fee.

You may also want to check out how I dug myself out of over $10,000 in debt in 7-steps.

Related Posts:

• Could You Erase $70,000 in Debt in 1 Year?
• How to Settle Debts On Your Own.
• Balance Transfers – Simple Solution or Debt Enhancer?
• Congress Takes Aim At Debt Settlement Scams.
• How To Negotiate Credit Card Debt.

Tips to Avoid Foreclosure Scams!

Do you know how to spot a foreclosure scam?

When a public notice of impending foreclosure of your house is released, this can generate unwanted solicitations from unscrupulous agencies that promise to help you avoid foreclosure.

Sometimes these scam artists can take the guise of a mortgage restructuring firm, and often times promise their “clients” they have received a high success rate of stopping foreclosures.

If some one contacts you offering foreclosure assistance, chances are they do not have your best interest at heart. This is especially true if any of the following apply:

• They require an up front fee.

• They tell you to stop communicating with your bank or mortgage company.

• They press you to transfer the title to your home to them.

The problem is that most of these scammers are either looking to bilk you with extra fees, or take your house out from under you!

As a general rule of thumb, don’t trust anyone contacting you. A better solution if you find yourself in such dire straights is to contact a housing counseling agency certified by HUD (Department of Housing and Urban Development) There you should find free or low-cost foreclosure assistance.

Photo by respres

Related Posts:

• JaMarcus Russell About to Lose his Mansion to Foreclosure.
• Is Peachtree Settlement Funding Scam?
• Could You Live off Credit Card Rewards Points? This man is. (VIDEO)
• New Home Sales Down 7.6% In December.
• Mortgage Debt Relief in Effect Until 2012.