5 Things to Know Before Selling Your Structured Settlement

We often have individuals calling or emailing simply to inquire as to what the process of selling a structured settlement entails. When people call, most are overwhelmed and don’t know where to start. This blog is meant to be a starting point for anyone considering selling their structured settlement payments.

1. Selling Structured Settlement Payments Takes Time

The process from start to finish is going to take time. 30 – 60+ days to be more specific. This does not mean you need to rush into the decision to sell structured settlement payments. In fact, it’s the opposite. This is an important financial decision and one that shouldn’t be taken lightly.  A Company should never rush a Seller but, all Sellers should allow themselves enough time so that they are not put in a situation where they have no choice but to fall behind on paying bills, tuition, etc.

2. Selling Structured Settlement Payments requires Court Approval

The process of selling structured settlement payments is governed by State and Federal statutes and does require court approval. The court approval process is for the benefit of all involved. As a seller, it is good for you to go before a Judge who reviews the documents and makes sure that you are getting a good deal and that the statute has in fact been followed by the buyer.  The Judge wants what is best for you, do not be intimidated about going before a Judge to have a transfer approved.

3. Not All Buyers of Structured Settlement Payments are Good Companies

As in any industry, there are great companies to work with and there are bad companies to work with. You can find out plenty of information about companies that buy structured settlement payments online.  Doing a little research is highly recommended.  A few key things you can do is read reviews from others that have previously sold structured settlement payments, check to see if a particular company is a member of the National Association of Settlement Purchasers (NASP) and last, check the companies Better Business Bureau site for complaints.

4.  The Value of Your Structured Settlement Payments will Vary

The value of your structured settlement payments is different than the aggregate of your structured settlement payments. For example, if you are selling $100,000.00 in payments, do not expect to receive $100,000.00 in return. Then how can you know the value? There are several factors that determine the actual value of your structured settlement payments. A few are the insurance company making the payments, the year the payments are due and whether or not the payments are guaranteed or life contingent All of these will have a significant impact on the value.

5. Have a Plan for the Amount and Use of the Funds Received

Determine how much money you need and what you plan to do with the funds when received. You don’t want to be in a position where you get way more than you need.  Likewise, you don’t want to be in a position where you don’t get enough money. You should have a general idea of the amount that will allow you to accomplish your goals. Secondly, you will need to determine and later disclose your plans for the money as this is something the Judge will look at when approving the transfer of structured settlement payments. It also is a form of budgeting so that when you receive a lump sum, you have a plan and do not get side tracked.