If you are considering selling structured settlement payments then you may know that the structured settlement purchasing industry has taken some knocks recently; this may have you wondering when, even if, it makes sense to sell your structured settlement. Well, whatever you call it – the factoring industry, the secondary market, the grey market – there are people who think negatively about selling structured settlement payments, and in many cases they have good cause for concern. However, there are also very valid reasons to sell your settlement and there are some reputable companies to work with.
The Purpose of Selling Structured Settlements
The fact is that the settlement purchasing industry serves a valuable purpose for many people. Structured settlements are generally put in place for important reasons; however, there are some situations when selling structured settlement payments may make sense.
First of all, while, as noted above, most structured settlements are initially established for very good reasons, sometimes they weren’t. That is, sometimes the structure of the settlement didn’t fit the needs of the person in the first place. This is rare, but it happens. More commonly, the settlement was a good choice in the beginning but something changed in the annuitant’s life that now makes the settlement a poor fit. Life happens. That is why factoring companies initially entered the scene, because there was a need for some people to sell their regular payments and take a lump sum payout instead.
When Selling Structured Settlement Payments Might be Right for You
Say that you, or a client, had an accident and received a structured settlement. It is likely that, at the time, you needed the settlement payments. You may have been early in the recovery process from your injury, still needing doctor visits and physical therapy, maybe still on an extended leave of absence from work and having little or no income. Those settlement payments were very important and useful, paying your medical bills each month and giving your family money to live on. But now, life has moved on, changing your financial situation and your needs.
Let’s say that your life got better. Perhaps you finally healed well. You are no longer going to the doctor, no longer in therapy. You don’t have all of those monthly medical bills. And you are back to work, perhaps the same job or maybe a different one, but you have income. You are doing alright financially. However, while you were healing and out of work you racked up significant credit card debt or you fell a bit behind on your house payment. You couldn’t worry about it at the time because you were recovering from your injury. But now you want to get up to date and go on with your life. Sadly, the monthly amount you receive from your settlement is simply not enough to get you caught up as late fees and fines keep piling up. You need cash now.
This is just the type of situation that made factoring companies spring to life. You now have the option of selling structured settlement payments, selling part or all of your payments, so that you can get the lump sum of cash that you need to pay off your debt and get your financial life back on track.