It’s not usually a good idea.
People that have received structured settlements for serious injuries can frequently be approached by so-called “factoring firms” who will buy up the settlement in exchange for a lump sum payout. There are dozens of these types of firms. Two of the biggest are J.G. Wentworth Company and Peachtree Financial Solutions.
Each state has its own law regarding how these companies are supposed to operate. Because of that, there are patchwork of consumer protection laws throughout the country that govern how these firms are supposed to operate. Injured accident victims or their families who have structured settlements are supposed to be protected by these kinds of laws. But it turns out the companies that buy up the settlements can take advantage of the laws.
It may be tempting to sell your structured settlement to a company that wants to give you a lump sum. Structured settlements are set up at the time the case is settled, and payments are typically made to the accident victim or their family either on a monthly basis, annual basis, or at a time. Upon which both parties agree at the time of the settlement. However it is rarely a good idea to sell your structured settlement for a lump sum. The factoring firms have the advantage in the financial arrangement, and typically get the better deal. If you find yourself in this situation, before selling your structured settlement for a lump sum, it is best to get good legal advice from an attorney the practices and consumer protection law.