What Requirements Must One Meet To Complete a Structured Settlement Sale?
People who benefit from a structured settlement often receive cash as the result of a successful personal injury claim. The money is usually awarded in increments over time, called annuity payments.
While having a steady stream of income from annuity payments has its upside, there are many legitimate reasons why you might choose to sell a structured settlement. You may need a lump sum of cash now in order to cover college costs, to buy a new home, or to pay down debt.
The good news is that it is possible to sell structured settlements. Doing so requires a court appearance by the seller (depending on the state) and the structured settlement buyer (the party willing to buy the annuities), along with a judge’s approval of the transaction.
But that’s not all. There are several other requirements for successfully completing this process.
First, the settlement seller must be of legal age – 18 or older – in order to engage in such a transaction.
Proof that the cash proceeds will benefit the well-being of the seller and his or her dependents is also necessary. The laws that govern the sale of a structured settlement are intended to protect both the seller and the buyer, and require a finding of ‘best interest’. There is a court process in order to make this determination.
Proof of identity is also required. If anyone else were to have access to settlement funding this could be a serious case of identity fraud. The accepted documents for legal identification are Photo ID, driver’s license, passport, and birth certificate.
At the court hearing, additional requirements often include the review of a settlement agreement and release; a letter stating the terms of the annuity contract, written on official letterhead from the insurance company involved; bank statements; and some state laws even require that the seller obtain an independent professional advisor to review the transaction.
The final requirement is that the judge reviews all of the documents and approves of the transaction for the structured settlement sale to officially take place.
Tags: