Should You Sell Structured Settlement Payments?

Structured settlements benefit many injured people and their family members by providing consistent, reliable monthly income to them, which helps them make ends met while they are recuperating from their injuries. They also provide those persons who couldn’t work during rehabilitation and depend on the periodic small payments for a steady income. This kind of settlement is often sponsored by insurance companies, and each month the recipient receives an amount that is much less than what he or she would receive if awarded a lump sum settlement. This arrangement is in place to encourage the courts to award awards that are larger than the value of the structured settlements. However, a common question that is asked is what is the current value of structured settlements?

Sell Structured Settlement payments

A structured settlement annuity is purchased either from a general insurance company, or from a private investor. When purchasing this type of annuity the financial institution or investor takes an equal amount of payments and pays them out over time. When determining the present value of a structured settlement annuity the sum is divided by the number of years the payments will be made for. This is the discounted value. The value of the payments will decrease over time as the person ages and the amount of payments will increase.

Many companies will buy structured settlements from injured parties at a discount if they know that the recipient will be unable to receive all or some of the payments at the time of the settlement. This can be done when the recipient is undergoing treatment for an injury that makes him or her unable to work. There are many companies that buy these payments from workers and use the money to pay medical expenses and other things that might be needed. However, there are many individuals who choose to sell Structured Settlement payments because they want to take advantage of the present value of the money and receive a lump sum of cash now. However, it is important to note that not all factoring companies buy structured settlements. You need to check with each factoring company that you do business with so that you are completely aware of their policy on buying or selling Structured Settlement payments.

Some people will choose to sell structured settlement payments when they are in a financial crisis. It is true that the present payments are less than what someone would have earned had they worked throughout their entire lifetime. However, in order to get a large lump sum of money when you sell structured settlement payments you need to have a steady income. If you are no longer able to work you will not be able to sell the payments and therefore you will not be receiving your promised benefits. However, if you do decide to sell the annuities you should consult with a financial advisor so that you understand how the process works.

Some of the best things that you can do when you sell structured settlement payments is to find a company that buys the payments at discount rates. A factoring company will purchase the payments for far below the market value. When you sell these payments at discount rates, you will receive the cash you need even faster.

Another reason that people choose to sell their payments is when they are in financial trouble. You may find that you are having problems keeping up with mortgage payments or you may not be able to make car payments. In these cases it is often better to sell structured settlement payments because you will be able to receive the full amount much faster than what you could receive through a loan. If you are unsure about whether or not you should sell your payments, consider consulting with a financial advisor who can help you determine whether or not you should move forward with selling.