Beware of Pension Factoring Ripoffs
The best mainstream journalistic article that I’ve seen on the subject is this one from the New York Times.
In the business world, factoring is common. The most common factoring is accounts receivable. Another type of factoring involves payment in advance for structured settlement payments. The intermediaries in these transactions can potentially rip off both the investors and the person obtaining the lump sum, a/k/a the borrowers. The implied interest rates in these deals are quite high. From what I’ve seen the rates exceed the 21% maximum legal rate for mainstream lenders in most states. It’s not such a great deal for the investor, either. The pensioner can actually cut off the stream of income. I think it’s arguable whether these contracts are ever legal due to lack of disclosure on the consumer side and lack of registration of the various lenders and intermediaries.
If you have a problem with a pension factoring company, or of you sold pension payments, especially if you are getting collection letters relating to the pension assignment, I am interested in hearing from you. Call me at 317-662-4529. If you are not in my area (Indiana), I will try to link you up with a NACA attorney.
If you have a problem with a pension factoring company, or of you sold pension payments, especially if you are getting collection letters relating to the pension assignment, I am interested in hearing from you. Call me at 317-662-4529. If you are not in my area (Indiana), I will try to link you up with a NACA attorney.
