Average Interest Rates For Structured Settlement Transfers

As you being the process of selecting a structured settlement purchaser to buy your annuity payments you need to research interest rates. There are several factors which determine the interest rate for your payments.

First, you should evaluate the payments you would like to sell. You should receive a lower interest rate for payments which are short term. Short term is typically considered payments which become due in the next 1 – 10 years. If your payments are long term the interest rate you are charged will likely be higher. Long term payments are typically categorized as payments which are due to be paid 10+ years out. The reason long term payments will likely have a higher interest rate is because of the time value of money and inflation. One Thousand Dollars due in 15 years is not worth $1,000.00 today. Due to the loss of value of the money, the interest rate will be higher.

Second, you should consider the amount of each payment you would like to sell. The larger your payments are, the more you can negotiate a lower interest rate. The smaller the payments, the less room for negotiation.
Lastly, when selling your structured settlement payments, it is important to remember that there are fees associated with the transfer. These fees play a role in what your interest rate will be. It cost approximately $3,500.00 to complete one transfer. The company you are working with will need to have an interest rate which not only covers their expenses but also allows a small profit. Each company purchasing these payments is doing so for a profit.

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