How A Structured Settlement Company Works

When looking to sell your structured settlement the best 
place to start is with a structured settlement company. 

Start your search for a structured settlement company via 
the Internet. Here you’ll find a selection of the best in 
financial companies. Visit at least three different websites 
so you can compare payout rates, fees and services. 

A structured settlement company is in the business of 
helping lottery winners as well as those with medical, 
insurance, accident or lawsuit settlements. 

Structured settlements are essentially financial settlement 
packages that are paid in regular installments over a 
specific length of time or for the life of the claimant. 

A structured settlement company or factoring company as it 
is sometimes called will give you a lump sum for a 
discounted price. The process is similar to ‘factoring’ a 
term used in business to maintain cash flow. Such a company 
sells accounts receivables to another company as an 
investment. The factoring company makes sure that any money 
that is owned to them is paid in advance. 

For instance, if a company is under contract to provide 
marketing services for $40,000 but even though all the work 
has been done and the marketing program is long since over, 
the organization is taking its sweet time to pay. Some 
organizations are just notoriously slow when it comes to 
paying its contract workers. This is where a factoring 
company would step in and purchase the check that is 
supposedly in the mail. 

The downside to this is that the company who did work would 
only receive about $34,000 of the original $40,000. Sure 
it’s 15% less but if you were to look at it in a positive 
light it may be to the company’s advantage. In the case of a 
small company operation, that $34,000 could mean the 
difference between staying in business and having to close 
their doors permanently. 

Now if you’re looking to acquire cash you could get out of 
your settlement payment arrangement using a structured 
settlement company which works much the same way. 

The structured settlement company would be the recipients of 
your payments and you would be given a lump sum payment 
instead. Of course, the amount you would receive from such a 
factoring company would be 10 to 15% less than the total 
money you would have received over the term of your 
settlement. 

The upside to receiving cash from a structured settlement 
company is that you would now have a lump sum to use for 
whatever you desired. You could buy a new house, pay off 
debts, handle unexpected financial expenses etc. 

Selling your payments can be a win win situation for both 
the settlement claimant and the structured settlement 
company but first you need to do your homework to make sure 
that selling your payments is what you really want to do. 
Once you sell to a factoring company there is no turning 
back. The settlement payments they receive are no longer 
yours. 

Okay, you have decided that selling structured settlement is 
in your best interest but how does one go about getting cash 
for structured settlement payment? 

First off you need to do your homework and acquire a broker 
or brokerage firm to help you out.. Every reputable broker 
and/or brokerage company will have a website you can use to 
research more about them and their services. 

Reputable brokers and firms will take the time to answer any 
selling structured settlement question you may have. Most 
will also give you a free consultation over the phone and 
will take the time to explain how the cash for structured 
settlement process works. 

In doing the research that is required to get you the most 
cash for structured settlement payment, you should consult 
not one but several different brokers and/or firms. Selling 
structured settlement is a big financial transaction and 
should only be done with a broker and/or firm you’re 
comfortable with. By consulting several brokers you’ll be 
able to gauge which ones are honest and trustworthy and 
which ones are only in the business to make a quick buck for 
themselves. 

Another reason to comparison shop is find out how much your 
payments are worth. In order for a broker to give you a 
realistic cash for structured settlement payment quote a 
broker will need to do some calculations to determine the 
current value of your remaining payment. This figure may 
differ between brokers. 

Since you’re the one selling structured settlement it’s 
important for you to understand what its current value is 
and how it’s calculated. 

Basically, it’s a calculation of what your payments are 
worth in today’s dollars. When you factor in inflation, the 
current dollar value is worth less than what a dollar will 
be valued at in the future. When making calculations, a 
broker will take the present and future dollar values into 
consideration and determine a realistic value for your 
remaining payment. 

In other words, you’ll receive less in a cash for structured 
settlement payment now than if you had continued to receive 
your payments over the course of your structured settlement 
term. 

That said, when you factor in taxes, inflation and the cost 
of living in the future you’ll see how the current value is 
a realistic representation of the value of your settlement 
annuity as it stands today. 

When selling structured settlement, it’s in your best 
interest to retain a broker and/or brokerage firm who has 
related experience buying and selling annuities for others. 

Unfortunately, you’ll find that since the industry is 
relatively new (buying and selling structured settlement 
payments have only been legal since 2002), there may only be 
a small number of specialized brokers available to you 
locally. 

When deciding on the right broker to help you get cash for 
structured settlement payment you’ll also benefit from a 
large firms who employs several brokers and therefore are 
not out to gain the maximum commission on every transaction. 
A larger brokerage firm with experienced brokers, also know 
how to work the system and will make sure that they get your 
sale before a court within a reasonable time frame. When 
dealing with brokers with less experience the process can be 
lengthy and somewhat complicated. 

The bottom line when selling structured settlement and 
looking to get the most cash for structured settlement 
payment is that you seek out the expertise of a 
professional.

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