Seller’s Market but Who’s Your Advocate?

A severe seller’s market exists in the factored structured settlement space however the most preferential pricing is not achieved by all sellers.  Factored Structured Settlements “FSS”, also known as, Secondary Market Annuities “SMA”, In-Force Annuities “IFA” and Pre-owned Annuities “POA”, are primarily the transference of structured settlement payment rights from injured parties through a court approval process under 26 USC § 5891.

In a typical scenario the injured party, also known as the; payee, annuitant or seller, wants or needs additional money that exceeds the regular payments to which they are entitled.  They then approach or respond to an ad or solicitation from a factoring company, also known as an originator, and inquire as to how much and/or how many payments they must sell in order to raise the necessary capital they are seeking.  In some cases the seller recognizes the tremendous value of their payments and shops them around aggressively from factoring company to factory company in an effort to generate a better and better price for their payments.  In almost every case the seller prevails when they utilize this approach as long as the play their cards right.  This is not rocket science but it can be a lot of work and in most cases the best opportunities for the seller are found on the internet which can require a lot of negotiation skills.

The bottom line is that you need to be your own self-advocate and make haste slowly!  If you’re considering selling payments, get several quotes and don’t jump at the first offer even if you think it’s a good one and/or you like the salesperson, regardless of how much free stuff they offer you.  If you need help I encourage you to contact our company.  At Somerset Wealth Strategies, LLC and or sister company dedicated to this asset class “SecondaryMarketAnnuities.com” we place our investors on the payment streams that sellers are divesting themselves of, e.g. our investors have the lump sum and want payments and the sellers have the payments and want a lump sum.  That said, although we are not a factoring company originating payments for sale we do work with over 20 to 25 of the top ones.  This means we have the ability to assist sellers on a more objective basis and help get them more for their payments than they may be being offered from others.  The decision to sell your payments or a portion of your payments is yet another life altering event, in addition to the one that entitled you to the payments in the first place, so don’t mess it up.  Take your time, shop around and don’t sound desperate.  You’re in charge because you have what they want and you need to understand this right out of the gate.

Last updated by Thomas Hamlin at December 10, 2013.