Selling a Structured Settlement or Annuity in Pennsylvania

A structured settlement or annuity is a valuable and versatile type of asset. Selling part or all of an annuitant’s future payments can be important for various financial goals, like paying down debt or funding large purchases. However, it’s important for structured settlement and annuity holders to understand how a lump sum cash payout from a structured settlement or annuity sale would stand up against the value of future payments, and how their state of residence handles these kinds of transactions. In the state of Pennsylvania, as in most other states, selling a structured settlement or annuity requires local court review and other key processes. A 2000 law called the Pennsylvania Structured Settlement Transfer Act governs the sale of these assets within the state.

Pennsylvania Structured Settlement and Annuity Law: Disclosure

One element of Pennsylvania state law on selling a structured settlement or annuity involves the obligation of a buyer, a company paying out advance payments on the asset, to show the asset holder exactly how up-front payments contrast with the value of future payments. Like other states, Pennsylvania law does this by requiring a calculation called ‘discounted present value’ that can show the future value of incoming scheduled payments from a structured settlement or annuity. The law also requires disclosure of all costs for the deal, including:

• service charges
• processing fees
• commissions
• legal fees

Pennsylvania Structured Settlement and Annuity Law: Independent Professional Advice

Many states have some requirement that structured settlement and annuity sellers be advised to look for a ‘second opinion’ for a structured settlement or annuity sale from an outside professional. Pennsylvania has an even more detailed requirement that a structured settlement or annuity buyer tell the seller to consult with a lawyer about the tax consequences of a transaction.

PENNSYLVANIA STRUCTURED SETTLEMENT AND ANNUITY LAW: VENUE

The Pennsylvania law specifies that the local court of common pleas in the seller’s area of residence will review the sale of structured settlements and annuities. The law also sets up criteria for courts to judge whether the deal is in the best interests of the seller, and whether it would financially harm any dependents, for example, through impairing the asset holder’s ability to make child support or alimony payments.

SELL YOUR STRUCTURED SETTLEMENT OR ANNUITY WITH CBC

Other than getting educated about Pennsylvania structured settlement and annuity law, another way you can optimize your structured settlement or annuity sale is by shopping around to different asset buyers. At CBC, we have not only have an excellent track record, but a dedication to customer service and a willingness to help you complete your sale according to your needs. Ask us how we can help finalize one of these lump sum payment deals in the state of Pennsylvania.

Tags: