Have you ever needed money? I mean really needed money. Most of you who read this probably have not. For better or worse, I can tell you that growing up in a single-parent home (yes, I was a “latch-key” kid) there were plenty of times we needed money. And despite careful planning and cutting corners, plenty of times it was just not there.
Unexpected financial crises happen for everyone. My wife and I just found out that we need to have some serious repairs done to our bathroom at home, and the bill will run into the several thousands of dollars. Thankfully, we can afford it – not that it won’t sting. But there’s a difference between a sting and a bite. For many people, as for me growing up, thousands of dollars may as well have been millions. It would just not have been there.
Maybe this is why I’m sympathetic to the structured settlement factoring customers. They remind me of my late mom. To be sure, not all of them are worthy of admiration, and not all of them have great reasons for selling payments. But, most of them share in common the fact that this is their only option for money. Most are not as well off as you. And they think, often correctly, that they need the money.
Articulated reasons for selling structured settlement payments range widely, but most often it is to pay debt. Anyone who has needed money understands the burden and slavery of debt. Dave Ramsey says, “If you're in debt, then you're a slave.” The poor feel the impact of this servitude more than others, and the ramifications are often more pronounced. For the better off, the impact of debt may be you need to purchase a less-nice car, or not take a vacation this year. For the poor, it can and does mean the difference between food or medicine, electric bill or gas money – which do I pay and which do I try to stave off for a bit?
There’s a somewhat famous transfer story about a guy trying to sell payments in order to get his electricity or gas turned back on at home, and the judge denied the sale. “I was cold last night in my house judge, were you?” said the seller on his way out of the courtroom.
Selling structured settlement payments to pay off debt may be a great way out. Hopefully people who get out will stay out, but the lure of debt is strong. Nonetheless, a factoring transaction can help, and does not involve the stain and difficulty of bankruptcy or incurring more debt.
Sometimes I am disheartened by stories of judges who do not give due respect and consideration to structured settlement sellers. Factoring companies surely also are disrespected, but that is a cost of doing business for us. It’s not right, but we can put up with it. Sympathy should be reserved for the seller – the structured settlement payee. For them, a factoring transaction is likely their last hope. They are probably not very familiar with the court process and judicial system. They are nervous, scared, apprehensive.
Put yourself in their shoes for a moment. You need money. You must go to court and talk about personal and embarrassing financial matters in front of strangers. Now consider this:
The judge and court staff openly snicker at the transaction and your situation.
The judge refuses to hear the transfer application and throws you and the factoring company attorney out of the courtroom, accusing the attorney of “trying to steal money.”
You are treated like an imbecile, not able to make choices for yourself.
The vast majority of transfer cases are handled respectfully and accord proper dignity to all parties. But, the above are examples of things that have really occurred. Rare, but shocking and unacceptable nonetheless.
Not all factoring transactions should be approved. Not all sellers are upstanding members of society, capable of handing finances, etc. Not all structured settlement factoring companies are good corporate citizens doing the right thing. But, I encourage judges, court staff, politicians and those who ponder these matters to consider these transfers individually, with respect for the individual seller. They need that, and deserve no less.
Monday, April 23, 2012 at 06:06PM