HOW DOES THE BUYING AND SELLING OF STRUCTURED LEGAL SETTLEMENTS WORK?
The ability to sell your structured settlements for a lump sum is a quite regular occurrence. Companies buying structured settlements will usually give a high value “now” in order to collect a guaranteed payment “later”. Remember that the courts must approve all structured settlement sales.
If you sell your structured settlement know that you will lose between 15-25% of the total value of your structured settlement. This is because of devaluation. One dollar now will not have the same buying power in 10 years or even 5 years, so companies buying your structured settlement have to make up for that.
The Beauty of Structured Settlements
Structured settlements are wonderful to have. If you suffered a great physical trauma and got a structured settlement in return they provide some restitution for your pain and make up for income you may have lost. The law makes sure that you get money on a steady basis. It’s like having a paycheck that you don’t have to go to work to collect. Structured settlements are well protected by the law and largely free of market volatility, but they come in a series of smaller payments over time, instead of one lump sum.
“Cashing out” or selling your structured settlement gives you one big payment all at once. The court may analyze your reasons for cashing out but once approved you can use the money any way you want.
Conclusion
If you are willing to give up 25% of the total value of your settlement over time in order to get paid out all at once and enjoy your money now, then selling your structured settlement is probably right for you.
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