Selling structured settlements is nothing new, and it’s becoming increasingly common, particularly as the economy continues to struggle. While ongoing payments in a structured settlement offer stability to payees, there can be an immense need for immediate cash right now. For instance, job loss, back bills, danger of defaulting on a mortgage and other financial concerns can convenience structured payment holders that now is the time to sell. However, buyers face some risks in the process.

Court Considerations

One of the first risks that structured settlement purchasers will face is the court process. Selling structured settlements is not a simple, expedient process. Every single sale will have to go through the court so a judge can determine if the sale is possible. One of the first risks purchasers will face is that the judge will deny the sale off the bat. It’s certainly possible, as the law leaves this to the judge’s discretion.

State Laws Add Complications

Payees cannot sell structured settlements for just any old reason. For instance, they can’t sell their payments if they want to go on vacation or buy a second home. They can’t sell if they want to use that money to refurbish their homes or to put their children through college. Most states have laws on the books stating that not only must the payee show proof of need that would make the sale necessary, but that the sale itself would be in the payee’s best interest (this is done to keep sales to unscrupulous buyers out of the picture).

The Wait Time Is Critical

While late night infomercials might make it seem like the structured settlement sales process is simple and straightforward, this is really not the case. In fact, it can take 30 days or more to see the sale come to an end. It can be much longer than this if there are complicating factors, and different jurisdictions, payment types, payment amounts and payee needs can add even more complications to the situation.

In the end, the risks structured settlement purchasers face are just as great as those faced by individuals looking to sell their settlement. In both cases, the best option is to work with a reputable brokerage who can take the uncertainty out of the situation and guarantee a beneficial sale for both parties in the transaction. The right brokerage can simplify, streamline and offer peace of mind for sellers and purchasers.