There are many reasons that you may have to know how much is my present value. Some of these reasons can relate to buying a home, paying off credit cards or other debts or even winning money in a lottery. Having a fixed monthly income is important in everyday financial life. The second question that you must be asking is “How much is my present value?”
There are two factors to consider when you want to know how much your structured settlement future payment is worth. The first factor is the discount rate and the second factor is the present value of the payments. The discount rate is what you may already know as the interest rate on the payments. The present value is basically what your payments would be at the time of winning the lottery or other big cash award.
The best way to get the answers to both questions is to get them from several sources. The first place that you will want to check is with a reputable broker or factoring company. These companies are very familiar with the rules and regulations that govern selling settlement payments. They also have brokers that are well versed in communicating with the court date and having the right amount of time to accomplish the deal. A broker or factoring company can tell you how much you are owed based on several factors.
Once you have all of your facts together, you will then want to go back and determine whether it is a good idea to sell structured settlement payments. There are several things to consider such as whether the buyer will pay your current premiums or if they will offer you a lower rate. You will need to look at their track record of paying their claims in order to determine whether they will settle for a price that you can live with. You will also need to factor in the amount of time that it will take them to pay the future payments as well as the potentiality of a large lump sum payment in the future.
In most cases, it is not recommended that you sell structured settlements for immediate cash. Although you may be able to receive a large lump sum payment for future payments, the IRS will view this transaction as an investment and will hold onto your payments until such time as you are able to repay the loan. This can be a very unpleasant outcome and you could find yourself in legal trouble if you sell your structured settlements for immediate cash. If you still have a unsecured loan on your home or car, you should also avoid trading your structured settlements for lump sum payments.
When you decide to sell your structured settlement for a lump sum payment, you should realize that it is never a good idea to accept cash in full. Most reputable buyers will not allow you to pay the full amount, and you will need to pay taxes on any amount that is received. However, you may be able to sell your payments for a much lower total than the total of the payments that are remaining to you. Before you decide to accept an offer, you should contact a qualified broker who can advise you on the details of trading your structured settlements for a lump sum payment.