If you've entered into a structured settlement agreement with an insurance company or other part that promises to pay an award in installments, you may have a reason to sell your structured settlement in the future. Many people sell structured settlements if they are short on funds and need a cash advance without taking out a loan. Remember that funds in a structured settlement may serve as a reliable source of income for you and could be an asset. If you simply can't wait for your award amount to come in small increments, you may be better of selling a structured settlement and getting a lump sum check for a percentage of the original award amount.

Reasons to Sell Structured Settlements

People sell structured settlements for a variety of reasons. Some people simply don't want to wait for the installment amounts to come in over the course of their lifetime and have plans to put those funds to good use. They may want to purchase a home, buy a car or pay for their child's education, and don't want to make high-interest payments to do so. Others may need some cash to take care of a family emergency, or to pursue a business opportunity. There are a number of good reasons to sell structured settlements and doing so could give you some financial freedom.

How Do I Sell My Structured Settlement?

If you've asked yourself the question, "how do I sell my structured settlement?", you may have considered consulting an attorney or financial advisor for assistance. Selling a structured settlement is a relatively simple process, but you do need to do some research to find a company that you can trust. Most people interested in selling a structured settlement turn to private funding companies for assistance. These companies will either work on a flat-fee basis or calculate a quote based on your settlement award amount. You will need to contact the company to review your situation and review their proposal for the sale. Most companies will pay you directly in the form of a lump sum payment that is wire transferred to your bank account.

Steps to Selling a Settlement

Selling a structured settlement is perfectly legal. Most states are governed by the Structured Settlement Protection Act that allows you to sell your payments only if you meet certain requirements. Under this act, you must:

  • Be given full disclosure about the financial terms of the sale with the company who is helping you with selling a structured settlement
  • Be granted a "cooling off period" after signing your agreement in case you change your mind or if you wish to cancel your sale
  • Be advised in writing to seek out professional advice about the sale, either from an attorney or a financial expert. Some states do allow you to waive this.
  • Participate in a hearing so that the judge can consider the case and decide whether you want to approve the sale. At this stage, the judge will take a close look at your financial situation and determine whether it is in your best interest to sell your structured settlement at this time.
  • Get the judge's approval through a court order that approves the sale.