If you are concerned that your structured settlement isn’t meeting your needs, it might be time to sell it for cash. This can happen for many reasons: medical bills, debt, buying a home, starting a business or unexpected circumstances may stress your budget. Sometimes, having a lump sum can help you improve your situation. In order to get this cash, it is possible to sell your structured settlement.
When you sell your structured settlement for cash, you basically sign over the right for someone else to receive your payments. That person then pays you a lump sum for the right. However, you will not get the entire amount that the annuity is worth. Instead, it is discounted. But if you are in need of a large sum of cash rather quickly, selling your annuity can help ease your current situation. It is also worth noting that you do not have to sell your entire settlement. It is possible to sell only half, or a quarter, of your settlement.
Before you sell your structured settlement, however, it is important to understand the state laws. While most states will allow you to sell your structured settlement annuity for cash to a third party, some do not. Find out the restrictions in your state before you decide on whom to sell your structured settlement to. Also, be aware that in some states court approval is required before you can sell your structured settlement. The buyer may further deduct court fees from the lump sum you are paid.
How to select the right buyer for your structured settlement
If you decide to sell your structured settlement for a lump sum, it is important to find the right buyer. You should take your time, and do some research, before choosing a buyer. Investigate several potential buyers before making your selection. Here are some things to look for when considering buyers for your structured settlement annuity:
- Reputation. First and foremost, you need to find a buyer with a good reputation. Check with the Better Business Bureau. Find out whether any complaints have been made against the structured settlement company. Also, find out what kind of complaints they are. Look online as well. Find forums and Web sites that list reputable buyers. You can also check with your state or your city’s Chamber of Commerce to find out about licensed and reputable structured settlement buyers.
- Amount offered. Different companies offer different amounts of cash for structured settlements. You can actually get bids on the amount of money that companies will offer you. Get quotes from between four and six structured settlement buyers and compare them. Watch out for lowball bids that are obviously not fair. Also, look out for companies that offer you very high amounts. Some of the less scrupulous buyers will offer something very high, and then delay the process or tack on additional fees so that you will gradually come down out of desperation, or the value of your lump sum is mostly taken away by extra fees. Getting several quotes can help you gauge what most companies think is fair.
- Time for the transaction. The shortest transactions of this kind usually take 4-6 weeks. In some cases, especially when court approval is necessary, it can take up to three months to complete the sale of a structured settlement. Watch out for companies that promise to get the money to you in a matter of days. Usually such an arrangement involves a loan against the total. This can reduce the amount of money that you receive in your lump sum payment. Find out which company offers a reasonable amount of time, and one that is unlikely to delay.
- Customer service. When you are looking for bids from buyers, take note of how you are treated. Did you speak with a representative? Does the representative get back to you in a timely fashion? Has the company been up front about answering your questions? You want to make sure that whoever buys your structured settlement is responsible and helpful. Additionally, you do not want to feel pressured. Watch out for companies who create a sense of urgency and insist that you need to make a quick decision.
When choosing the right buyer for your structured settlement, it is important to consider a variety of factors. You need to ensure that the buyer is reputable and honest, as well as helpful and properly legal. By doing a little research, and taking the time to check up on potential buyers for your structured settlement, you are more likely to select the one that works best for you.