It is possible for recipients of a structured settlement payment to sell a part of the amount for a lump sum that can be used for meeting some near-term expenses. The process of transferring one's rights to a structured payment to another party for a sum is referred to as factoring. The first step should be to assess whether one is actually required to sell a structured settlement payment or an alternative is available. The amount of money available with these transactions is inversely proportional to the period of the settlement. It is important for a seller to be aware of the lowest value for which he is willing to sell his structured settlement payment.

The sale of a structured settlement has to be approved by a court. The approval depends upon the court's assessment of an annuitant's need for immediate cash, his capabilities in managing a substantial amount of money, and whether the interests of annuitant and his family will be served by a sale of annuities. If a structured settlement is sold without prior court approval, it attracts a federal excise tax of 40% on the amount sold.

There are various laws instituted by states across America for regulating the sale of a structured settlement and protecting the seller from unscrupulous buyers. Buyers are bound by law to disclose the amount that is transferred. This amount is compared against the amount made available to the seller. The interest rates charged by buyers have a significant impact on the actual amount received by an annuitant. Therefore, it is important to take the services of companies that offer to buy structured settlements at competitive rates and can design a solution to meet an individual's requirements.

When comparing companies for carrying out such a transaction, it is worthwhile to compare their track records in terms of integrity, financial soundness, and reputation. Free quotes can be obtained from different companies, there are no obligations attached with these quotes. One can also take the services of a settlement broker who has the necessary experience in dealing with settlement purchasers.