If you are a broker or an attorney and a client calls wanting to get access to his or her payments, are you truly providing them viable options? Although most brokers and attorneys may not admit it publicly, most do refer their clients to someone to assist them with their factoring needs. But is that enough?

A primary broker has many options in assisting a client when they initially come to them to help set up their structured settlement. The combination of the broker’s and attorney’s experience and knowledge of the laws, insurers, rates, client needs and other factors, all play a role in the broker’s facilitation of the settlement process. At the end of the day, all the options are analyzed and calculated and you provide your client with the best options available for their current and future foreseeable financial needs.

The same characteristics hold true for Settlement Factoring. A broker and attorney should apply a similar process to a client who calls inquiring about factoring as they do a client calling to inquire about a structured settlement. Like we have stated before, not all your clients have the need to sell and they should only sell if the transaction is in the best interest of the annuitant taking into account the welfare and support of any dependents.

Like the insurers, not all direct factoring companies offer the same products and rates for every situation. Take for instance non-guaranteed payments (life contingent payments). Some factoring companies will not purchase these payments while there are few companies that will purchase them for a steep price. Truth is the pricing varies from factoring company to factoring company based on several different conditions. Rates can vary from anywhere from 9% up to 18%+ depending on the factoring company and the situation.

Just as a primary broker and attorney are knowledgeable about the life providers, trust companies and other products, they should become aware of the differences between the factoring companies themselves. Some have huge direct marketing budgets to attract customers directly, which in turn leads to higher costs and higher rates. Some companies / individuals claim to be independent funding companies, but in reality are just outside salesmen / saleswomen funneling all your clients back to their parent company while taking lucrative commissions. Some factoring companies like Settlement Capital work primarily and directly with structured settlement brokers, planners, attorneys and consultants. This low-key approach may not make us the biggest company in the business, but it insures we are able to put the customers needs first while passing the savings on to the customer as well.

In the end, your client’s current financial needs are what are most important. Make sure you are referring your client to a direct factoring company who shares your desire to insure your client’s current and future foreseeable financial needs are being met while insuring the best possible pricing options in the industry. Not all factoring companies are alike and that can be a good thing for you and your client.