Based on recent news about the secondary cash market for structured settlements, you already know that transferring your settlement payments from one company to another is perfectly legal. However, if you’re selling your structured settlement, involving your own lawyer or a structured settlement attorney who focuses on such hard life situations is highly recommended before you even shop around for a quote. The reality is that once a structured settlement is purchased, it’s usually very difficult, if not impossible, to get it out of the agreement. Here are some reasons why.
First, you will never know what the true value of your settlement is until you actually cash it out. This makes the entire transaction rather difficult, because the buyer may want you to accept a lower rate now, but could end up paying a much higher rate later on. In fact, the rate they pay you today, may turn out to be substantially higher when you calculate future premiums. And the factoring companies often don’t even offer to do this calculation on your behalf, so you’re stuck having to do it on your own.
Second, the lump sum payment that these companies offer will only vest, in the majority of cases, if the buyer can verify the accuracy and validity of his purchase contract. This can prove to be quite challenging, because buyers can simply rewrite the contract to suit their own needs. A structured settlement purchaser who know he’s purchasing a legitimate settlement won’t attempt to Dodge the reality and will perform all the necessary calculations to come to the accurate value of the settlement.
Third, if you want to sell structured settlement payments, it’s always best to buy today and wait to receive your lump sum. That’s because settlement future annuity rates don’t change. In fact, if you buy now, you may very well get a better rate down the road. Your present value becomes discounted, which means it becomes less valuable. If you take the time and make the effort to research for market prices, you may be able to sell for a much better price.
Finally, buyers who are looking to sell structured settlement payments should understand how the insurance company does business. Some companies will only sell future payments, while others will offer immediate cash. The buyer needs to understand the payment structure and what each option means for his or her individual situation.
How to Sell Structured Settlement Payments: Understanding the ins and outs of the buying process is key to selling structured settlements for a lump sum. Don’t be intimidated by a broker or salesperson who suggests you buy today. You’ll want to buy now, not tomorrow. Once you have found a buyer that understands your unique situation, the negotiations can begin. You can sell structured settlement payments for a lump sum or a full annuity. The best choice depends on your unique situation and budget.