If you are considering selling your structured settlement, you need to know how much it is worth so that you understand whether or not the offers that you are getting are fair and reasonable. Given that you will be able to get quotes off of a marketplace that pits different buyers against one another, you should have a reasonably high likelihood of getting a good offer. The process online tilts the leverage in your favor by creating competition.
Even with that said, you need to know what your structured settlement is worth so that you can set a target price that you will receive. Make sure that you evaluate all of the factors carefully and make a decision that is not based upon impulse so that you do not make a decision that you regret in the future.
In order to figure out the present value, there are a number of different things that you need to take into account. They are laid out below, based on the present value calculator from StructuredSettlement-Quotes.com.
You have to keep in mind when you are planning on selling your structured settlement, that you will need to provide a discount on the total value of the remaining payments to be made. This is because the current monetary value of a payment to be made in the future is not equal to the amount of the payment, but actually a little bit less. That is because the money can earn interest over time and can be invested and used in order to make more money.
As a result, you will need to offer a discount in order to get the lump sum right away. In addition, you need to factor in that those making an offer on your structured settlement need to have the opportunity to turn a profit. As a result, you will not get 100 percent of the remaining value in an offer. The difference between that full value and what you are offered is the discount rate. This is what you can expect to receive for your structured settlement.
What is a Fair Discount Rate?
This is a common question and the truth of the matter is that it can vary significantly. Normal discount rates vary between about eight percent and 14 percent, and the exact discount rate that you will need to give in order to sell your structured settlement will depend upon how many payments are remaining, when they are scheduled and how frequently the payments are made. The longer people have to wait to receive their payments, the greater the discount rate will need to be.
How Can You Get the Best Offers?
You don’t just set your discount rate and then see if anyone bites. As a result, you are actually in a position of strength when selling your structured settlement. You will simply provide information about what is left on your structured settlement, along with your contact information. From there, potential buyers will make offers at various discount rates.
You will be able to compare their offers and select one to continue with if you still want to sell your structured settlement. As a result, the marketplace should have enough competition in order to provide you with the best offer possible on your structured settlement.
In the past, without the online marketplace, getting a good offer was a much more difficult process. As a result, people didn’t sell their structured settlements as often and usually did not get a great deal when they did. It was a buyer’s market then, but now it is a seller’s market.