by Diamond Channing

Created on: January 23, 2011   Last Updated: March 01, 2011

If you are interested in selling a structured settlement you need to do your homework and research before doing so. There are a number of advantages with receiving set payments which includes the tax benefit as well as being able to count on a set amount of money being paid to you each month, quarter, semi-annually or annually for a determined amount of time. There are times when people feel the need to cash in their structured settlement for one lump sum of money. This is often due to having financial difficulties.

In the last few years there have been a number of new companies sprouting up offering to purchase those structured settlements and promise to pay you one lump sum of money. There are a number of things you should consider before making the final decision to sell the structured settlement. These companies do not pay the total amount of the settlement and instead pay you far less. The companies are contacted by people who are usually in desperate financial situations and need cash immediately. Some of these companies take advantage of this and can get away with paying you very little money in comparison to the value of the settlement since they know the chances of you accepting their offer are quite high. Even with companies who are operating above board and on an ethical level they still tend to offer far less than what you might expect to be paid due to the costs involved.

You will want to contact a number of these companies to find out how much they will pay you for the settlement as their fees vary from one company to the next. Once you have found a company you would like to do the transaction with you will be asked to complete an application. If it is approved they will sit down with you to discuss the terms of the sale as well as how much they will pay for the settlement.

Be sure to first check with the Better Business Bureau to find out if the company has any complaints. Check the Internet for information about the company and watch for complaints listed on-line. Make sure you read the documents you received from the attorney when the structured settlement was set-up for you since there are a few states that do not allow these to be purchased.

Keep in mind you will owe the taxes due on the money if you sell the settlement. You will want to make sure you have the money to pay this before using the lump sum of money for anything else. It is a good idea to have an attorney and an accountant review the settlement before selling it. Many times a court must approve whether or not the structured settlement can be sold. The attorney should be able to tell you if this is the case with your structured settlement.

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