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Purchase Structured Settlements – The Process of Buying Annuity Payments

In order to purchase structured settlements Annuitants must first obtain court authorization to sell annuity payments in whole or part. Since annuities are often structured to provide long-term income to individuals injured in accidents, Annuitants must provide courts with a compelling reason to sell forthcoming payments.

Private investors who purchase structured settlements must abide by state and federal regulations. Nearly two-thirds of states prohibit the sale or transfer of annuity payments. Therefore, investors must work with a qualified attorney to ensure they comply with the law.

Annuities are also established for jackpot lottery winners. Instead of receiving lump sum cash payment winners can elect to obtain annuity payments paid out over the course of twenty years. Lottery winners often elect this method to reduce overall taxes and receive the full amount of the payout.

Individuals’ fortunate enough to win lottery jackpots should consult with a lawyer to determine which payout option best suits their needs. Some states that prohibit the sale of annuities established for long-term medical or disability income will allow partial sale of annuities obtained through lottery payments.

Annuitants must obtain legal counsel before entering into agreement with companies or investors who purchase structured settlements. In many cases, the life insurance company which guarantees annuities must provide written permission to investment companies that want to purchase structured settlement annuities.

There are many reasons Annuitants choose to sell annuity payments. Common reasons include: obtaining cash for investment purposes; pay off credit cards and outstanding debts; obtain funds for college tuition; and home improvements.

Depending on state law and life insurance company policies, litigation settlements can be sold in whole or part. Investors buy annuities at discounted rates and provide Annuitants with lump sum cash. For instance, an Annuitant receives $25,000 per year for 20 years, which is paid quarterly. He receives $6250 per installment.

The Annuitant needs $50,000 to invest in real estate which he plans to use as rental property. In order to obtain the $50,000 he will need to sell two or more years of annuity payments. The funding source might assess a fee of 25-percent for providing upfront cash advance.

The Annuitant obtains permission from the life insurance company backing his structured settlement and presents his case to the court. Upon receiving court authorization, he transfers payment rights to the structured settlement investor.

The life insurance company authorizes transfer of rights and submits future payments to the investor until the number of sold payments is reached. Afterward, payment rights transfer back to the Annuitant who receives remaining payments.

Purchasing litigation settlements can be profitable for investors and provides consistent cash flow. Investment risks are minimal since annuities are guaranteed by life insurance companies. Investors charge upfront fees for providing cash advances, but must wait for disbursement of annuity payments.

Structured settlement lawyers can assist in negotiations and determine if purchase offers are reasonable. Annuitants and investors should weigh the advantages and disadvantages of buying and selling annuities, including tax liabilities.

Annuitants should comparison shop structured settlement annuity buyers to obtain the best deal. One trusted source for locating annuity buyers is through the National Structured Settlements Trade Association at

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