Bypass Student Loans: Use a Structured Settlement for College Tuition Payments
Covering the high costs of a college education is a challenge for many American families these days. Student loans may seem like the answer but that debt can remain a burden for years. Deferments can be hard to come by, and changes in income can leave the borrower with even more costs in late charges, penalties and increased interest. But you have options if you have an annuity or structured settlement to cash out for education costs.
Using a structured settlement process to pay tuition involves taking advantage of existing assets to avoid debt, and it’s a smart way to get around the interest and other costs associated with conventional student loans. Selling a structured settlement frees up cash that allows a student to pay down tuition at the time they enter school and may allow for a “free and clear” financial situation after graduation.
The history of college tuition charges makes it clear that education costs continue to skyrocket. To deal with huge tuition bills, the average student takes out significant student loans. Government grants, specialized student loan programs, or scholarships are available but in the end, a lot of the costs of attending a school, as well as living expenses, often fall on the student or family members. In 2011, graduating seniors owed an average of $25,250 in student loans.
To help out, the federal government capped its student loan interest rates at just over 3.4%. However, this cap on student loan rates is set to expire on July 1, 2012 with rates doubling to 6.8% for the 2012-2013 school loan.
That’s why a structured settlement sale makes a lot of sense for incoming college students. This process, essentially an “advance” on assets, doesn’t come with interest, as it’s not a debt. Rather, it’s taking equity out of an asset and using it to pay for tuition upfront to avoid debt. Also the process is regulated by 47 states and requires court approval for your protection.
When you need a settlement lump sum for education expenses, it’s a good idea to research the best firms that can help you to get cash out of your settlement. Be cautious when shopping as some firms will pass on additional charges relating to legal and administrative fees. The right firm will disclose all fees and charges upfront, inform you about the process and deliver your proceeds immediately following court approval.
At CBC, we have a lot of experience helping clients to “cash out” of a structured settlement in order to make large payments for tuition or other major expenses. Simply put, we provide our clients with the individual care that structured settlement sellers don’t always get with a larger company. Let our dedicated team of structured settlement buyers help you plan and execute a settlement sale for college or university costs.