sell your structured settlement

Blog post
28 Jul, 2023
sell your structured settlement

If You Find Yourself Receiving A Structured Settlement As A Result Of A Lawsuit, Lottery Win, Or Other Legal Settlement, You Might Be Wondering If It's Possible To Access A Lump Sum Of Cash Instead Of Waiting For Periodic Payments. The Good News Is That Selling Your Structured Settlement Is Indeed An Option, Providing You With The Financial Flexibility You Need. However, Before Making Any Decisions, It's Essential To Understand The Process, The Potential Advantages, And The Factors To Consider. This Comprehensive Guide Will Walk You Through Everything You Need To Know About Selling Your Structured Settlement.

Understanding Structured Settlements


Before Delving Into The Selling Process, Let's First Grasp What A Structured Settlement Entails. A Structured Settlement Is A Financial Arrangement Wherein An Individual Receives Compensation Over Time Rather Than A Single Lump Sum. This Is Often Used As A Way To Provide Long-Term Financial Security To The Recipient. The Settlement Is Typically Structured With Fixed Payments Scheduled At Regular Intervals.

Reasons to Sell Your Structured Settlement


While Structured Settlements Offer Financial Stability, There Are Situations Where Receiving A Lump Sum Can Be More Beneficial. Some Common Reasons Why Individuals Consider Selling Their Structured Settlements Include:

1. Immediate Financial Needs


Life Is Unpredictable, And Emergencies Can Arise When Least Expected. Selling Your Structured Settlement Can Provide Quick Access To Funds, Allowing You To Cover Urgent Expenses Such As Medical Bills, Home Repairs, Or Educational Expenses.

2. Investment Opportunities


Investments With Potential High Returns May Come Your Way, But They Often Require Significant Capital. Selling Your Structured Settlement Can Enable You To Seize Such Opportunities And Potentially Secure Your Financial Future.

3. Debt Settlement


Dealing With Debt Can Be Overwhelming. Selling Your Structured Settlement Can Help You Clear Debts, Relieve Financial Burdens, And Improve Your Credit Score.

4. Major Life Events


Whether It's Buying A Home, Starting A Business, Or Funding Your Dream Wedding, Major Life Events Often Require Substantial Financial Resources. Selling Your Structured Settlement Can Turn These Dreams Into Reality.

Assessing Your Financial Needs


Before Deciding To Sell Your Structured Settlement, It's Crucial To Assess Your Financial Needs Thoroughly. Consider The Specific Amount You Require And How It Aligns With Your Long-Term Financial Goals. Analyze Your Existing Financial Situation And Create A Budget To Ensure That Selling Your Settlement Won't Leave You Financially Vulnerable In The Future.

Finding a Reputable Buyer


Once You've Determined That Selling Your Structured Settlement Is The Right Decision, The Next Step Is Finding A Reputable Buyer. Research Various Companies Or Individuals That Purchase Structured Settlements. Look For Reviews, Ratings, And Testimonials To Ensure You're Dealing With A Trustworthy And Fair Buyer.

The Selling Process Explained


The Process Of Selling Your Structured Settlement Typically Involves The Following Steps:

Research: Gather Information About The Selling Process And Understand The Legal Implications Involved.
Obtain Offers: Reach Out To Potential Buyers And Request Quotes For Your Settlement.
Evaluation: Compare Offers And Assess Which One Aligns Best With Your Financial Needs.
Documentation: Prepare And Submit The Necessary Documents To Initiate The Selling Process.
Court Approval: In Many Cases, Selling A Structured Settlement Requires Court Approval To Ensure It's In Your Best Interest.
Receive Funds: Once The Court Approves The Sale, You'll Receive Your Lump Sum Payment.

Factors Affecting the Selling Value

Several Factors Can Influence The Value Of Your Structured Settlement When Selling It. These May Include:

Remaining Payments: The Number Of Remaining Payments Affects The Overall Value, With More Payments Typically Resulting In A Higher Value.
Payment Amount: The Size Of Each Payment Also Contributes To The Overall Value.
Market Conditions: Current Economic Conditions And Interest Rates Can Influence The Selling Price.
Buyer's Fees: Be Aware Of Any Fees Charged By The Buyer, As They Can Impact The Final Amount You Receive.

Tax Implications and Legal Considerations


Before Selling Your Structured Settlement, It's Essential To Understand The Tax Implications And Legal Aspects. Depending On Your Location And The Nature Of The Settlement, The Sale Might Be Subject To Taxes. Consult With A Financial Advisor Or Tax Professional To Gain Clarity On Your Specific Situation.

Weighing the Pros and Cons


Selling Your Structured Settlement Is A Significant Financial Decision, And It's Essential To Weigh The Pros And Cons Carefully. While It Provides Immediate Access To Funds, It Also Means Sacrificing The Security Of Regular Payments. Consider Your Unique Circumstances And Consult With Trusted Advisors To Make An Informed Choice.

Alternatives to Selling Your Structured Settlement


sell your structured settlement

If Selling Your Structured Settlement Isn't The Best Option For You, Several Alternatives Can Still Provide Financial Relief. Some Alternatives Include:

  • Partial Sale: Instead Of Selling The Entire Settlement, You Can Sell A Portion Of It To Meet Immediate Needs While Retaining Future Payments.
  • Loans: Explore Loan Options That Leverage Your Structured Settlement As Collateral.
  • Financial Assistance Programs: Inquire About Government Or Nonprofit Programs That Can Provide Assistance In Times Of Need.

Tips for a Smooth Selling Experience


To Ensure A Smooth And Successful Selling Experience, Consider The Following Tips:

  • Research Thoroughly: Understand The Process, Market Trends, And Legal Requirements.
  • Seek Professional Advice: Consult With Financial Advisors, Attorneys, Or Accountants To Make Informed Decisions.
  • Negotiate Wisely: Don't Settle For The First Offer. Negotiate With Buyers To Get The Best Deal.
  • Read The Fine Print: Carefully Review All Agreements And Contracts Before Finalizing The Sale.

Key Takeaways


  • Selling A Structured Settlement Involves Legal Complications. Consult With Professionals, Familiarize Yourself With Your State's Laws And Understand That Court Approval May Be Required.

  • Hiring Trusted Advisors To Guide You Through The Process Can Help You Make Informed Decisions And Protect Yourself Against Unscrupulous Buyers.

  • Select A Reputable Buyer By Researching Companies, Getting Multiple Quotes And Checking For Accreditation. This Process Will Help You Ensure A Fair Deal For Your Structured Settlement.

  • After The Sale, It Is Important To Manage The Unit Money Wisely To Avoid Financial Loss.

Understanding the Structured Settlement Selling Process


If You Accept Payment From A Structured Settlement, You May Consider The Benefits Of Receiving A Large Lump Sum In Exchange For Your Future Payment Stream.

Perhaps You Have A Significant Expense To Cover, Or You Want To Make A Significant Investment In Your Future. Whatever Your Motivation, Selling Your Structured Settlement Can Be A Worthwhile Option. However, Understanding The Process And Potential Outcomes Is Essential Before Making A Decision.

Selling A Structured Settlement Isn't As Simple As Finding A Buyer And Exchanging Your Future Payments In One Fell Swoop. You Need To Consider The Legal Aspects, Assess Your Financial Situation And Strategize To Secure The Best Deal.

To help you understand how to sell your settlement, we’ve divided the process into a few key stages:

  • Assess Your Finances
  • Understanding The Legal Aspects
  • Choosing The Right Buyer
  • Sales Negotiations
  • Finalize The Sale
  • Manage Your Money

By Understanding These Steps, You'll Be Better Prepared To Make Good Decisions For Your Finances, Both Now And In The Future.

1: Take a Good Look at Your Finances

2: Legal Considerations

3: Find a Reliable Buyer

4: Negotiate the Sale

5: Finalize the Sale

6: Manage Your Money


sell your structured settlement


sell your structured settlement

If You Change Your Mind About Selling Your Structured Settlement After Starting The Process, You Do Have Options. The Specific Options Available To You Might Depend On The Stage Of The Process You're In And The Terms Of The Agreements You've Signed With The Buyer.

Step 1: Take a Good Look at Your Finances

Before You Consider Selling Your Structured Settlement, Thoroughly Assess Your Financial Situation. This Step Is Important, As It Allows You To Identify Your Immediate Financial Needs And Long-Term Financial Objectives This Information Can Help You Decide If Selling Your Structured Settlement Is The Best Choice For You.

Evaluate Your Needs and Goals


The First Critical Consideration Is Your Motivation For Selling Your Structured Settlement Payments. Are You Facing A Large, Unexpected Expense, Such As A Medical Bill Or Home Repair? Or Perhaps You're Planning To Buy A Home Or Finance A College Education.

Understanding Your Needs And Objectives Can Guide You In Making An Informed Decision. Devote Some Time To Thoroughly Consider Your Current Situation And Future Plans.

Decide How Much Money You Need


Once You Know Why You Need The Funds, You Can Begin To Calculate The Amount Required. Are You Trying To Pay A $10,000 Hospital Bill Or Save Up A $200,000 Down Payment For A House? The Amount You Need Will Inform Your Decision On Whether To Sell Part Or All Of Your Structured Settlement.

Bear In Mind, The Lump Sum You Receive Will Typically Be Less Than The Total Amount Of Your Future Structured Settlement Payments.

Weigh the Pros and Cons


There Are Pros And Cons To Selling Your Structured Settlement. Immediate Access To A Significant Amount Of Money Can Be Helpful, But You'll Also Be Giving Up A Steady Stream Of Income In The Future.

Moreover, The Lump Sum You Offer Will Usually Be Less Than The Total Of Your Future Payments.

Consider These Factors Carefully. Consult A Financial Advisor Or Trusted Family Member Before Making A Decision. Make Sure You Think About Both Your Immediate Needs And Your Future Financial Stability.

Step 2: Legal Considerations


When You Decide To Sell Your Structured Settlement, You Are Entering A World Filled With Legal Jargon, Complicated Rules And Court Procedures. Understanding The Legalities Is Important To Ensure A Smooth Sale And A Successful Outcome.

Consult a Financial Advisor or Lawyer


First Things First, It Is Advisable To Seek Expert Advice. A Financial Advisor Or Lawyer Can Help Guide You Through The Selling Process.

They Can Break Down Complex Details, Help You Understand The Implications Of Your Decisions, And Advise You On The Best Course Of Action.

Understand State Laws and Regulations


In Most States, The Structured Settlement Protection Act Requires A Court To Approve A Structured Settlement Sale. The Court's Role Is To Ensure That The Sale Is In Your Best Interest And That You Are Not Being Exploited.

While This May Seem Daunting, Remember That This Is A Measure Designed To Protect Your Financial Interests. The Process Can Take Some Time, So Factor That Into Your Plans.

Prepare for Court Approval and Discussion with the Judge


The Court Approval Process Involves Explaining To A Judge Why You Need To Sell Your Settlement And How It Will Benefit You Financially.

It Is Important To Prepare In Advance And Clearly And Convincingly State Why Selling Your Structured Settlement Is Beneficial To You. Be Prepared To Discuss Your Financial Plan And How The Lump Sum Will Help You Achieve Your Goals.

If You Don't Need To Sell The Entire Structured Settlement, Consider Selling A Portion Of It. This Option Allows You To Get Some Cash Now While Maintaining Some Of Your Future Regular Payments.

Having A Plan And Being Able To Communicate It Clearly Can Help You Present A Compelling Case.

Step 3: Find a Reliable Buyer


Once You’ve Made The Choice To Sell Your Structured Settlement, It’s Time To Find The Right Buyer. But Remember, Not All Buyers Are The Same.

A Reliable And Honest Buyer For Your Structured Settlement Should Have A Good Reputation, Offer A Fair Deal And Have The Right Qualifications.

Find Trustworthy Companies


Your First Task Is To Create A List Of Possible Buyers. But How Can You Tell If A Company Is Trustworthy? Research. Look At What Other People Have Said About The Company Online. Check Out Their Past Performance.

Despite More Stringent Regulations Since The Structured Settlement Act Of 2002, Issues Can Still Arise.

Questions To Ask While Researching Purchasing Companies Include:

How long has the company been in business?
A Company With A Long History In The Industry Is Generally A Positive Sign.

What do other customers say about the company?
Look For Online Reviews Or Testimonials To Get A Sense Of How Previous Customers Feel About Their Experiences.

Are there any complaints filed against the company?
Check With The Better Business Bureau (Bbb) Or Your State’s Attorney General Office To See If Complaints Have Been Filed.

Does the company have any industry accreditations or certifications?
Look For Professional Credentials That Indicate The Company Meets Industry Standards And Best Practices.

What kind of customer service does the company provide?
You Want A Company That’s Responsive, Helpful And Willing To Answer All Your Questions.

How does the company determine the value of your structured settlement?
The Company Should Be Transparent About Its Valuation Process.

Does the company provide a no-obligation quote?
Reputable Companies Should Provide You With A Quote Without Requiring A Commitment From You.

Obtain Quotes from Different Companies


Once You Have A List Of Potential Buyers, It’s Time To Start Getting Quotes. Why Get More Than One Quote? Much Like When You’re Shopping For A Car Or A House, Getting Multiple Quotes Ensures You Secure The Best Deal.

Each Company Will Give A Different Price For Your Structured Settlement, So Comparing Offers Can Help You Find The Best One.

And Remember, This Is A Negotiation, So You Can Use These Quotes To Get A Better Deal.

Check for Recognitions and Certifications


Finally, Check Whether The Company Has Any Special Recognitions Or Certifications. These Are Indicators Of Credibility In The Industry — They Demonstrate That The Company Meets Certain Standards And Adheres To Best Practices.

Be Wary Of Companies Without Any Industry Recognition. You Want To Ensure You’re Working With A Professional And Honest Buyer.

Step: 4 Negotiate the Sale


You’ve Checked Your Financial Situation, Learned About The Legal Side And Found A Potential Buyer. Now, It’s Time To Get Ready To Work Out A Deal.

Negotiating Is A Conversation Where You And The Buyer Work Together To Agree On Something That Works For Both Of You.

Understand How Buyers Determine Price


Before You Can Negotiate Effectively, You Need To Understand How Buyers Decide On A Price For Structured Settlements. They Consider Factors Such As The Total Value Of Your Settlement, The Duration Of The Payments And The Discount Rate They Apply.

This Discount Rate Is How Purchasing Companies Profit And Is One Of The Main Aspects That Can Be Negotiated. Understanding These Factors Can Enhance Your Negotiation Skills.

Prepare To Work Out a Deal


Be Ready To Negotiate When Selling Your Structured Settlement. Remember How Much Money You Need Right Now, But Also Remember How Much Your Settlement Is Worth In Total.

Use The Quotes You Got From Different Companies To Your Advantage. If Another Company Offered You More Money, Don’t Be Afraid To Mention It. Negotiation Is A Two-Way Process, And Your Input Can Significantly Influence The Final Offer.

Look Over the Contract Carefully


Finally, Before You Agree To The Sale, Read The Contract Carefully. This Is The Agreement With The Buyer That Explains How Much Money You’ll Receive And The Terms Of The Sale.

Ensure You Understand All The Terms And Take Your Time To Read Through The Document. If You’re Uncertain About Anything In The Contract, Ask Your Attorney Or Financial Advisor For Help. It’s Essential To Understand And Agree With Everything In The Contract Before You Sign It.

Step 5: Finalize the Sale

You’ve Navigated Through Learning, Checking, Searching, And Negotiating. Now, It’s Time For The Last Stage: Completing The Sale.

Finalize the Paperwork


Much Like When You Buy A House Or A Car, You’ll Need To Fill Out Certain Paperwork When You Sell Your Structured Settlement. This Might Include A Disclosure Statement That Gives Information About The Sale, A Sales Agreement Or Other Legal Papers.

The Buyer Should Help You With This Process And Make Sure You Understand All The Paperwork.

If There’s Something You Don’t Understand, Don’t Hesitate To Ask Your Financial Advisor Or Attorney. Remember, This Step Is Important Because It Makes The Sale Official. Take Your Time And Be Thorough.

Consider Tax Implications


Did You Know That Selling Your Structured Settlement Can Affect Your Taxes? Depending On The Nature Of Your Settlement And How The Sale Is Structured, You Might Have To Pay Taxes On The Money You Receive.

Consulting A Tax Professional Can Help You Understand How Selling Your Settlement Might Affect Your Taxes.

Get Your Money


Finally, It’s Time For The Part You’ve Been Working Towards: Receiving Your Money. Once The Court Approves The Sale And All The Paperwork Is Done, The Buyer Will Give You The Sum Of Money You Agreed Upon.

This Is When The Sale Is Considered Complete. Usually It Takes Between 45 And 90 Days From The Time You Agree To Sell Until The Time You Get Your Money.

Remember, This Is Just An Average And It Could Take More Or Less Time Depending On Your Situation. Always Ask Your Buyer To Give You An Idea Of How Long It Will Take.

Step 6: Manage Your Money


Once You’ve Successfully Sold Your Structured Settlement, You Enter A New Phase: Managing The Money You’ve Received.

This Isn’t Just About Spending The Money, But Planning How To Use It Wisely, Making Smart Choices And Getting Good Advice.

Create a Financial Plan


A Survey By Charles Schwab Found That People With A Written Financial Plan Are Twice As Likely To Achieve Their Financial Goals. Therefore, It’s Important To Have A Financial Plan In Place When Managing Your Lump Sum.

Create A Plan That Shows Where Your Money Should Go To Best Meet Your Needs And Desires. You Might Need Money Right Away For Things Like Buying A Car, Paying Off Debts Or Covering School Costs. But Don’t Forget About Your Long-Term Goals As Well, Like Saving For College, Buying A House Or Even Preparing For Retirement.

Having A Plan Will Help You Make Smart Decisions And Keep You From Spending All Your Money Impulsively.

Seek Professional Advice


Managing A Large Sum Of Money Can Be A Daunting Task. This Is Where A Financial Advisor Can Be Of Great Assistance. These Experts Are Well-Versed In Money Management. They Can Help You Understand Your Options, Make Informed Decisions About Investing, And Steer You Away From Poor Financial Choices.

Be Cautious of Predatory Practices

Unfortunately, Not Everyone Will Have Your Best Interests At Heart. Some Individuals Might Attempt To Deceive You And Take Your Money. This Could Happen Through Scams, Unfair Deals, Or Investments That Promise More Than They Can Deliver. It’s Important To Stay Vigilant And Cautious.

The Federal Trade Commission Estimates That Consumers Lost Over $8.8 Billion To Scams In 2022. As Such, It’s Important To Stay Alert And Cautious To Protect Your Money From Bad Deals And Scams.

Always Check Everything Twice Before Making Significant Financial Decisions And Say No If Something Doesn’t Feel Right. Remember, It’s Your Money, And It’s Your Right To Keep It Safe.

sell your structured settlement {FAQ}

sell your structured settlement

Can I sell only a part of my structured settlement?

Yes, You Can Opt For A Partial Sale And Keep Some Of Your Future Payments Intact.

How long does the selling process take?

The Selling Process Can Vary, But It Often Takes Several Weeks To Months To Complete.

Will selling my structured settlement affect my credit score?

Generally, Selling Your Structured Settlement Won't Directly Impact Your Credit Score.

Are there any restrictions on how I can use the lump sum payment?

No, You Can Use The Lump Sum Payment For Any Purpose, Including Investments, Debt Settlement, Or Major Expenses.

Why would someone want to sell their structured settlement?

People Might Want To Sell Their Structured Settlements If They Need A Large Sum Of Money Immediately For Things Like Paying Off Debt, Buying A House, Covering Medical Expenses Or Starting A Business.

Is selling a structured settlement a good idea?

It Depends On The Individual’s Financial Situation. Selling A Structured Settlement Can Provide A Large Lump Sum Immediately, Which Can Be Beneficial In Certain Circumstances. However, It Also Means Giving Up Regular, Guaranteed Payments In The Future.

How is the value of my structured settlement determined?

The Value Of A Structured Settlement Is Determined By Several Factors, Including The Total Amount Of Future Payments, The Timing Of Those Payments And Current Interest Rates. Buyers Will Typically Present A Discounted Cash Value Offer, Which Is Less Than The Total Of The Payments.

What should I consider before selling my structured settlement?

You Should Evaluate Your Current Financial Needs And Future Financial Security. Selling A Structured Settlement Can Provide Immediate Funds, But You’ll Be Giving Up Future Payments. It’s Also Important To Consider Legal Requirements, Potential Tax Implications And The Reliability Of The Buyer.

How long does it take to sell a structured settlement?

On Average, It Can Take Between 45 And 90 Days From The Time You Agree To Sell To Receive Your Lump Sum. This Can Vary Based On Your Specific Circumstances And The Efficiency Of The Buying Company’s Processes.

Conclusion

Selling Your Structured Settlement Can Be A Game-Changer, Offering Financial Freedom And Opportunities. However, It's Crucial To Approach The Process With Caution, Considering Both Short-Term Needs And Long-Term Consequences. Assess Your Financial Situation, Research Potential Buyers, And Seek Professional Advice Before Making Any Decisions. Remember, Knowledge Is Power, And Being Well-Informed Will Empower You To Make The Best Choices For Your Financial Future.

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