Federal and State Laws give You the Right to Sell

A Guide to everything you should know about selling.

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Chapter 6

Let Strategic Capital buy structured settlement payments from you: Federal and state laws give you the right to sell!

The law gives Strategic Capital the right to buy structured settlement payments from you. We talk throughout the Strategic Capital website about federal and state law, but let’s go over some specific structured settlements information, very clearly, and give you some structured settlement 101 as relates to the law.

Federal Law and State Law

Federal law gives you the right to sell your structured settlement payments for a lump sum, as long as you get court approval. Nearly every state also has their own structured settlement protection acts, which further guarantee these rights and set up the courts to review structured settlements sales. These acts are largely based on, even taken from, the federal protection act.

The states who do not have their own structured settlement protection acts are New Hampshire and Wisconsin.

However, you can still sell a settlement if you live in these states as long as the insurance company who owns your annuity is located in a different state – you can get court approval in that state.

Non-Transfer or Assignment Language

Some original structured settlement contracts may have language in them which says that you cannot sell or transfer payments, called non-transfer or non-assignment language. Sometimes, the judge will uphold such language and not allow anyone to buy structured settlement payments from you.

As Patrick Hindert, Managing Director of S2KM Limited and a lawyer highly experienced in the settlement industry, said, “Anti-assignment’ clauses in settlement documents are enforceable and, if enforced, could prevent structured settlement recipients from selling their payment rights.” For example, one Florida court case (Rapid Settlements, LTD., v. Kimberly Dickerson, et al.) made it up to the court of appeals, and still the judge declined the sale, saying that the sale was clearly against the agreement. But judges do not always uphold such language.

Thus, even if your paperwork has such a clause it may be worthwhile to consult with a Strategic Capital representative and see what they say about your chances of approval.

You can Sell a Lottery Annuity

We have talked a lot about selling structured settlement payments, generally those that arose from lawsuits. However, some people also wish to sell a lottery annuity or casino winning payments. These are considered “periodic payments” rather than “structured settlement payments,” though in many ways they are the same.

In most states these periodic payments can be sold as well, but they usually require court approval, also. The same structured settlement factoring companies that purchase lawsuit settlements can purchase lottery payments as well.

In most states, except New Jersey, you do not need court approval to sell casino jackpot payments.

However, you do need approval in every state to sell lottery winnings. So, much of what is written here would apply to those sales; thus it is important that you be informed and make an educated decision. Likely, one can assume that the court approval phase might be a bit easier on selling winnings, as these funds were received by happenstance and not intended to help you heal from injury or make ends meet.

Be familiar with your paperwork!

It is always a good idea to be very familiar with documents before you sign them, and to understand the contracts to which you are bound. So, before you get too far into your structured settlement sale take the time to read over your initial settlement paperwork. Some of it may be in overly legal language that is difficult to read, but at least skim it over and ensure that you understand the basics of what the settlement papers say. And if you have questions about language, such as anti-assignment clauses, ask Strategic Capital about it. And of course, before you sign any sales paper be sure to read them carefully.

A Word of Caution

Coming from a background of business and finance, Terry Taylor has worked as an advocate for those trying to sell structured settlements, providing structured settlements information not trying to encourage sales but trying to protect their rights, for decades. Terry’s biggest worry is that people too often fail to thoroughly read their settlement sale contract. He says that the language in this document is as important as the original settlement structure and has the potential to cause grave financial disaster. Terry notes that one particular problem that sometimes occurs in these contracts is when the purchaser sneaks in language that directs all future payments to be paid directly to the buyer, allowing them to serve as broker, sending the seller their share. This, Terry asserts, delays payments and could end in disaster if that purchasing company goes into bankruptcy.
 
The advice here… before you sell annuity payments of any kind choose a company to buy structured settlement payments, like Strategic Capital, that you feel is ethical, but no matter who you work with ensure that you read your contract paperwork thoroughly or have a legal advisor review it for you. At Strategic Capital we give you the structured settlements information you need to make the best decision for you.