What is the law related to the sale of my structured settlement annuity?
There are laws in place to protect individuals who are selling their structured settlement annuity.
In fact there is a federal transfer statute, and 47 states have a state law regulating the sale of a structured settlement annuity. The federal law is called the The Federal Structured Settlement Protection Act (SSPA) of 2002, and each of the 47 states have their own law which is listed below.
The sale of almost every structured settlement annuity in the United States must be approved by a state court. The state court not only makes the transaction permanent and secure for the buyer, it also protects the seller. As part of the court order transferring the rights to the future payments, the buyer must, per the court order, pay the seller the agreed upon purchase amount.
To make sure that seller of structured settlement annuity payments are not making a mistake by trading future payments for a lumpsum today, the judge that reviews each transaction must consider whether such a transaction is in the best interest of the seller. The seller must provide the judge with the reasons for the sale of their structured settlement annuity, and only if the judge confirms this is in the best interest of the seller will he or she approve the court order.