Structured settlements are financial award providing regularly payments over a period of time. Often confused with annuities, the payment vehicles are used to organize money owed to people in an effort to resolve claims that led to a lawsuit, thus the usage of the word settlement. As with other assets, some owners of these vehicles want to sell and move their money into other investments, homes, and other things.
Structured settlements are not liquid and require a judge’s approval to sell. Because the payments are made over time, they’re purchased for a discounted rate, i.e. less than their face value. The presiding judge will analyze why the owner wants to sell and the terms of the proposed deal.