Choosing buyers of structured settlements

So you’ve finally decided that you want to sell your structured settlement payout for cash. Hopefully, you have arrived at this landmark financial decision with the help of a trusted financial advisor and an attorney. At this point, you should have assessed your financial needs and have a clear idea of the kind of figure you want for your structured settlement. You should have also gotten all your paperwork in order and ironed out any legal and contractual restrictions as well as tax repercussions of your structured settlement contract. Last, but definitely not least, at this point you should have contracted the services of a broker who specializes in structured settlement sales. 

Now comes a major, time-consuming but all-important process: choosing a buyer. Spending time to really shop around for a buyer is the most important favor you can do yourself in this transaction, apart from relying on a trusted attorney or financial advisor. Here are some helpful hints to help you navigate the process of selecting a buyer.

Of the buyer beware: several things to watch out for

Low offers – Well, this one is easy enough. Sometimes, a prospective buyer will make you an offer that is unreasonably low. You don’t want that now do you? Low offers may be easy enough to wave off, but not if you’ve been looking for a buyer for a long time and your need for the cash is already at its direst point.

The best thing you can do is, plain and simple, stick to your guns. You and your attorney or financial advisor should have determined a reasonable figure for the sale of your structured settlement. Keep as close to it as possible. If you’re wavering, call upon your trusted attorney/advisor and ask him to remind you of all the reasons why you should not settle for anything less than this predetermined sale price.

Too much emphasis on cash, not enough on the company – When selecting a buyer for your structured settlement, consider the transaction in a holistic perspective. The quality of the offer is not just its timeliness and the amount of cash you can get – it’s also the track record, trustworthiness and stability of the company making a bid for your settlement. If the company in question harps on speed and cash, and doesn’t extol its own virtues as a buyer (or steadily deflecting your queries in this direction), this could be a red flag for an unsavory buyer.

Another red flag: a company that is uncertified. Legitimate structured settlement buyers will make readily available information about the company: its history, resources, customer references, industry affiliations and other sale-related issues such as privacy policies. Remember, even a good cash offer could be ripped to shreds by a mistake on the part of the buyer. And that’s not even speaking of the unscrupulous buyers who claim all the seller’s rights to the settlement payouts without giving them a single cent of the promised amount.

Consistent delays – Some unscrupulous buyers, after knocking your socks off with a sky-high lump sum offer, cause intentional delays in the sale and eventually make downward ‘adjustments’ to the original figure. This is a common structured settlement scam. Take note that your usual structured settlement transaction takes roughly 60 to 90 days to be completed, including the time it takes to secure a court order to authorize the sale. Any delay longer than this may point to a company looking to take advantage of any time-sensitive need for cash that you may (and most likely will) have.

As a corollary to this, any buyer offering you cash within a matter of weeks or even days should be avoided flat out. This is blatantly untrue, given the process of having to obtain a court order before any sale can be made. 
 

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