The statutes call them transferees. In practice they are specialist finance companies that buy discounted streams of payments from highly-rated life insurers, and a handful of them account for most of the market. What matters to a payee is less who they are than what the law requires them to do, because those duties are your leverage.
What a buyer owes you before you are committed
A written disclosure of the deal, and in Florida it is timed to the day: at least 10 days before the date on which the payee first incurred an obligation with respect to the transfer, the transferee must have provided a disclosure statement in bold type, no smaller than 14 points in size. In Texas the court must find that the payee was advised in writing by the transferee to seek independent professional advice. These are duties on the buyer, not favours.
What to ask any buyer
The discount rate, the gross advance amount and the net advance amount, itemised. Those are the statute's own words in New York, where the court is told to consider 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. Ask for the same three figures from two buyers and you can compare offers; ask for a single number and you cannot.
What a Florida court has to find
Florida's section conditions everything on express findings by the court, beginning with the fact that the transfer complies with the section and does not contravene other applicable law. It then does something the other statutes on this record do not: it puts a clock and a typeface on the disclosure. At least 10 days before the date on which the payee first incurred an obligation with respect to the transfer, the transferee must have provided the payee a disclosure statement in bold type, no smaller than 14 points in size, and the court must find that the payee received or waived independent professional advice.
Questions people ask about structured settlement buyer
Does a court really have to approve this?
Yes, in every state. The federal exception in 26 U.S.C. 5891(b) applies only where the transfer was approved in advance in a qualified order finding it is in the best interest of the payee, taking into account the welfare and support of the payee's dependents.
What is the single biggest variable in the price?
The discount rate, and after that how far in the future the payments fall due. The reported range across the market is between 9% and 18%.
Do you take a share of what I get?
No. Buyers pay a flat fee for the enquiry itself, never a share of the discount and never anything contingent on a transfer completing.