Buyer of Structured Settlement - What You Need to Know

Structured settlements of other people can actually be used to gain considerable profits. This can be done by buying a settlement. A buyer of structured settlement can profits in this way by buying the rights of a settlement at a lower price than the face value of the structured settlement at hand. The lower the price of a settlement has been purchased, the higher the buyer's profit becomes. Note that even though a buyer of settlement and its seller are the key parties in the process of transferring settlements, there are also other participants that have to be taken into account.

The guiding principle for this kind of transaction is that the purchasing (or selling) of a certain commodity takes place when there is a disagreement in value, while there is an agreement in price. In the case of purchasing (and selling) of a settlement, the commodity is the settlement itself. The seller of a settlement sees its periodic payments to be of less value than the price he is willing to sell it for. On the other hand a buyer of structured settlement places a higher value for the total amount of the structured settlement than the amount of money that he is going to pay for it.

A smart buyer of structured settlement will take advantage of this principle by making the seller' settlements seem to be of less value. One way to do this is by putting pressure on the seller's mind so that he immediately sells it. There is also another way for the buyer to make the settlement underpriced. This is by making the seller see that the purpose of selling the settlement is so urgent that the selling price that is being proposed will actually be enough. In other words, the buyer has to make the seller desperate for the price that he is proposing.

Although a buyer of structured settlement and its seller are the main players in the process of transferring settlements, there are also other parties that have to be greatly considered. One of those is the legal consultant. Remember that a settlement rooted from a lawsuit so the buyer has to be sure that the only thing he has to do is pay the declared price of the settlement, while he collects the regular payment of money done on the rights that he has bought. He has to make sure that he is free from any other legal obligations that are owned by the claimant (the seller) and the defendant (the one where he reaps his profit).