Selling structured settlement payments is a five-step process and only the first step is commercial. The rest is statutory, and it is the same in outline in every state, because every state has a Structured Settlement Protection Act. Knowing the order matters, because the point at which you can still change the deal is much earlier than most people realise.
One: the offer, and what it is priced on
A buyer prices the specific payments you want to sell rather than the whole stream. Amounts, dates and how far out they run decide the number, because a payment due in fifteen years is worth much less today than the same amount due in two. Ask for a partial transfer quote alongside the full one: selling a defined block of the nearest payments usually raises the sum you actually need at a far lower cost, and it is rarely what is offered first.
Two and three: the disclosure and the advice
Before you are committed to anything the buyer owes you a written statement of the deal, and in some states that duty is timed to the day and specified down to the typeface. Then the advice: several statutes require the court to find that the payee was advised in writing by the transferee to seek independent professional advice and either received it or knowingly waived it in writing. Both duties sit on the buyer, and both are things you are entitled to insist on rather than favours.
Four and five: the filing and the hearing
The buyer applies to a court for approval and the obligor, the annuity issuer and any irrevocably designated beneficiary are notified as interested parties, which is why a transfer cannot be done quietly. Then the hearing. New York states it in the same terms: no transfer is effective and no obligor or annuity issuer is required to make any payment to any transferee unless the transfer has been authorized in advance in a final order of a court of competent jurisdiction based upon express findings, including whether the discount rate used to determine the gross advance amount and the fees and expenses used to determine the net advance amount are fair and reasonable.
Questions people ask about sell structured settlement payments
Can I sell only some of my payments?
Yes, and it is usually the cheaper trade. A partial transfer sells a defined block and leaves the rest intact, so the discount applies to less money and your long-term income survives.
How long does the whole process take?
Weeks rather than days, and the court's calendar sets the pace. The offer is fast; nothing is effective until the order is final.
Do I have to attend the hearing?
That depends on the state and the judge, and it is one of the questions worth putting to the independent professional adviser the statute says you should be told to consult.
Who else finds out about it?
The structured settlement obligor, the annuity issuer and any beneficiary irrevocably designated under the annuity: the statutes name them as interested parties and they are notified of the application.