While the internet provides an invaluable tool to assist in researching topics normally reserved for experts, it is not intended to serve as a substitute for seeking professional advice whether legal, medical, or financial. Depending on the author and purpose of the article, there could be many conflicting opinions on the same issue. The objective for this series is to provide the necessary information to assist someone considering the sell or transfer of a structured settlement. Because each structured settlement is unique, it is the responsibility of the seller to seek legal advice before forfeiting rights to future payments. Unfortunately, there have been many instances of recipients of structured settlements being taken advantage of by companies preying on their financial hardships. In an effort to prevent this from happening, most states have adopted a Structured Settlement Protection Act that allows the sale of future payments if certain requirements are met. Seeking legal advice from a reputable attorney with experience in structured settlement laws will ensure that the seller has all the facts before making the decision to sell.
Most states followed a model when adopting the Structured Settlement Protection Act requiring certain conditions be met before the sell or transfer of structured settlement payments. Following are the common requirements that must be met from state to state:
• The seller must be given full disclosure about the financial terms of the sale.
• There must be a “cooling off” period after the documents are signed to allow time for the seller to change their mind and cancel the sale.
• The seller must be advised in writing to seek independent professional advice regarding the sale.
• There must be a court hearing to review and approve the sale. The judge examines the seller’s financial situation and the intent for selling the settlement payments and rules whether it is in the seller’s best interests to sell payments.
• The judge must issue a court order approving the sale.
While most states adopted this general model, each state’s statute could have further restrictions or requirements that must be met. An attorney will review the settlement details, even if there is anti-assignment or anti-sale language with respect to all applicable federal and state laws and provide their professional opinion on whether the sale of structured settlement payments is in the best interest of the seller. In step #3, Seek Financial Advice, we will discuss further the need to seek professional guidance to ensure the seller understands all the implications of this decision.
If you need help selling your structured settlement, annuity or lottery payments,
contact us today. We are here to answer your questions and help you obtain the
highest possible price for your payments.
