Should You Sell Your Structured Settlement Payments?

Have you decided that you would like to sell your structured settlement payments? If so, you're not alone. Many people decide that they'd rather have one lump sum rather than payments stretched out over long periods of time. There are both benefits and drawbacks to selling a structured settlement. The buyer of your structured settlement will likely offer you a price that is around 15% less than the current value of your structured settlement annuity. Not only will you be losing 15%, you will be losing more than that due to tax and inflation issues. Even so, many people still decide that a lump sum payment is what they want to do.

If this is what you decide, the first thing you should do is find a good broker. The business of buying and selling structured settlement annuities has only been a legal one since the year 2002, so finding an experienced broker in your area might be somewhat of a challenge. Often, you can find a good broker or brokerage firm by checking online. Any firm worth dealing with is going to have an informative web site. Many brokers will even offer you a consultation in person or on the phone for no charge.

Comparison shopping is very important when it comes to selecting a broker or brokerage firm. You may want to deal with a larger firm as opposed to a small operation. Larger firms that employ more brokers are often less concerned with getting the maximum commission and more concerned with providing their customers with the best service. After speaking with multiple companies you'll get a better idea as to which ones care more about your best interests and which ones are more concerned with their own bottom line. The more clients and experience a brokerage firm has, the better. An experienced broker can ensure the selling process goes as quickly and as smoothly as it possibly can.

Another reason to compare brokers is to compare the quotes you're given. A broker will determine the current and future value of your structured settlement annuity using a formula that factors in things like inflation, cost of living and tax implications. They will also let you know their commission for their services. These figures might vary from broker to broker, which is why its important to check with more than one. You definitely want to get the best deal and the most money you possibly can, and comparison shopping can help you do that.

While it's true that selling your structured settlement annuity will leave you with less money than if you kept it, there are times when it's still a good decision. For example, if you need to make a large purchase like a house, selling for a lump sum can benefit you. Another good reason to sell is if you're an investor or plan to hire one. Investing a large lump sum in the right way can provide you with gains that might even surpass the value of your structured settlement.

Whether or not you decide to sell your structured settlement annuity is a decision that should never be entered into lightly. Before making a decision, you should speak with an attorney, tax professional, and assortment of brokers. You should also think about your reasons for selling and weigh all the pros and cons of such a decision before taking action.

Copyright 2007 Jim Sterling - All Rights Reserved

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