"Interest Rates are going up. Act now and get more for your payments" bray the structured settlement cash now "mules" for Novation Settlement Solutions on social media as they seek to "burro" into your safe secure income stream for "chicken feed".
Novation's not so slick value proposition is an old school hustle that could have devastating consequences for structured settlement annuitants who get sucked into the Novation cash now fire sale "tractor beam".
Genex Capital weaved the same web to snare annuitants in 2009 on the basis of rising interest rates, that proved to be illusory. Anyone who heeded Genex Capital's howling would have been devastated because interest rates actually went down making the structured settlements more valuable. Read The Wolf of Structured Settlements' Inflation Howl Reduced To A Yelp.
What is the Federal Funds Rate?
Talk of rising interest rates is no doubt spurred by the recent small increase in the Federal Funds rate by the United States Federal Reserve ( "The Fed"). The Fed Funds rate is a benchmark interest rate—the key rate at which banks offer each other overnight loans—On June 14, 2017, The Fed raised the federal funds rate by 0.25 percentage points today and was set between 1% and 1.25%. It is the first time since 2008 that the rate will be at least 1%. According to Bloomberg, policy makers also issued forecasts showing another three (.25) quarter-point rate increases in 2018, similar to the previous projections in March. Inflation is under 2%.
Novation's Pig Doesn't Fly
Novation has a lot of fat in its deals. As I covered in a recent post, two Brooklyn New York Novation Funding cash now , structured settlement transfer hearings scheduled for August 2017, carry predatory effective discount rates of 17.07% and 19.85%. The Novation discount rates are hardly competitive.
- If you find yourself in need of cash then speak to a credentialed financial professional
- If you decide that selling structured settlement payments is the way to go for you, then shop around. Pay no attention to a structured settlement cash now pusher's "tug job". Don't respond to "tugs on your heart strings", use your head.
- Judges in places like Kings County should be mindful and informed of the approach that Novation uses to snare customers.