3 Commonly Asked Questions About Structured Settlements

structured settlementThere are many reasons why someone might receive an annuity. Perhaps you are getting a payout due to the outcome of a lawsuit or injury claim. Maybe you are guaranteed a certain payment over a period of time during your life or after your death. Some people simply receive regular monies from an insurance company.

No matter what the source, the one thing that can be challenging about these sorts of finances is that they are issued to you over time, rather than all at once. However, you can get around this in a creative way: by selling structured settlements.

Here are three commonly asked questions about doing just that.

1) What typically qualifies when I want to sell my annuity?

There are certain kinds of payments that most companies will honor in terms of a buyout, and there are others that they usually won’t.

Things that are considered acceptable include money that you receive for life insurance, settlement or lawsuit pay and insurance company payouts.

Things that typically aren’t considered eligible are monies you receive for childcare custody, mortgage payments, disability or pension annuities, social security, workers’ compensation, TIAA CREF, pre-settlements and viatical arrangements.

2) Is it Illegal for Me to Sell this Compensation?

No, it is not illegal. In fact, as a provision for citizens choosing to do this, many states actually have laws in place to protect you if you decide to sell your income stream.

Some examples of Structured Settlement Protection Act provisions include:

  • You should have a period (called a “cooling off”) that allows you to change your mind after signing any documents for the sale.
  • You will be given documentation that clearly explains all legal and binding aspects of the sale.
  • You must be advised to seek the advice of a financial professional in regards to this decision, although sometimes you are able to forgo the advice if you want.

There are often additional provisions, too.

3) Are Price Quotes Guarantees for Annuity Purchases?

Yes, if you receive a quote, that means that you are guaranteed that amount of money if you do choose to sell. You should be able to get a quote within 24 hours of starting the proceedings, although it can take as little as two hours to know how much you are being offered.

After you get your bids, you have a 48-hour period to decide whether or not you want to go with the deal.

Chris enjoys writing about anything that has to do with finances. Right now he’s most interested in structured settlements and selling structured settlements. When doing research on this topic, he found lots of helpful information at structuredsettlement-quotes.com

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