Selling your Structured Settlement

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Selling your Structured Settlement

Tuesday, February 24th, 2009    Subscribe To Our Feed

If you own a structured settlement annuity, you might receive a lot of benefits. First of all, you and your family/ dependents are made financially secure for a considerable amount of time because of having structured settlement payments and these payments including the interest earned on them are tax free. Also there is no legal hurdle in using this money either for your emergency situations or for high yielding investments.

The federal law HR 2884 protects individuals who want to sell their structured settlement payments to meet unplanned financial needs; this can be done without any tax implications. About 67% of the states in the United States of America also allow the sale of structured settlement payment in addition to the federal laws. The most important thing in this is that in both the cases the sale has to approved by a court.

Selling Your Structured Settlement

In case you are in a position to convince the judge about your actual requirement of funds for your use it is not all that difficult to sell all or part of your structured settlement payments. The judge will review your case to see if the transaction will benefit you and your dependents.

Any adult with a sound mind can get court approval for selling his structured settlement payments as long as he can prove that he and his family will get benefitted by this transaction. You ensure that you attend the hearing in the court on that day which may help your cause much. Even if you don’t get court approval for selling the structures settlement payments you can still sell this, however you will not get the tax free status for this.

The purchasing company with whom you are having discussions might be interested in purchasing your structured settlement payments. To facilitate finalization of the sale they will handle necessary legal formalities. They refrain from charging any fees for this effort they have taken; however, you are liable to pay tax on the money received without court approval.

First of all you must get quotes from various companies. You will always get benefitted if you have multiple quotations. If you like a quote that is given, you will send in copies of the structured settlement policy to the purchasing company. In return, the purchasing company will be sending a disclosure document that should be signed by you. You will find in this document the details of the conditions of the transaction. This should be signed and returned after your checking.

In order to proceed further it is essential that the court approval is got and this is the next step in this process. The state of residence of the seller and buyer decides on the duration for completion of this process and normally it may take up to 90 days. In most cases, once you are approved, you will receive your money within 10 days.