The one message I would like to leave is not really for people seeking to sell their payments. They already know it. It is to remember that sometimes a stream of structured settlement payments is the only asset people have. When life circumstances change and a lump sum of money can make a huge difference, then they can sell part of these payments. It is their property, and their right. They deserve to be treated with respect if and when they chose to sell payments.
Like what Matt Bracy has to say? Read their opinion on our other Structured Settlement Roundtable topics.
There is a role for factoring. Ultimately, a structured settlement recipient has free will and should be able to sell certain (not all) structured settlement rights. Some are not actually saleable. For those that are, an informed individual who understands the true trade-off and the steep discount rate that applies to “cash now” has the right to do so, with some protection afforded by courts in 47 states that have adopted protection acts.
One relatively new development is the rise of offshore sellers of factored structured settlement rights. They may create greater competitiveness in the factoring field, which over time may generate a lesser discount from the true value of periodic payments than the factoring companies generally have been willing to grant.
Like what Joseph J Dehner has to say? Read their opinion on our other Structured Settlement Roundtable topics.
Payees and their personal injury lawyers should consider the liquidity options they have relative to structured settlement payments when they first sign up a structured settlement in settling a case. Make sure that the underlying settlement documents allow a payee to transfer and assign their future structured settlement payments to a third party in a court – approved transaction completed in accordance with an applicable State Transfer Statute. Do not sign an underlying settlement agreement that deprives the payee of the right or option to liquidate future structured settlement payment rights.
Like what Earl Nesbitt has to say? Read their opinion on our other Structured Settlement Roundtable topics.
That often the sale of a person’s payment stream may be the only financial option available to a person with less than good credit and/or collateral to pledge against a loan.
That recipients of structured settlement payment rights have no ownership interest in the underlying annuity and cannot use a future payment stream for a loan.
That the sale of a structured settlement is a significant financial decision with long term consequences, and the decision to sell a structured settlement should be evaluated with the same effort, care and due diligence that a person would use when making the decision to purchase and/or finance a car or home.
Like what Eugene Ahtirski has to say? Read their opinion on our other Structured Settlement Roundtable topics.
While I still find the tactics used by many of the factoring companies, I have learned that there are companies out there that are concerned more with the person selling their structured settlement than the profit they can make from the sale. I was fortunate enough to find one of those companies in Strategic Capital. When I first started referring business to them I was shocked to find that they actually talked on of my referrals out of selling his structure before filing bankruptcy, when I could not convince him to do that.
Like what Terry Taylor has to say? Read their opinion on our other Structured Settlement Roundtable topics.