How to sell payments to a buyer of structured settlements - Part Five

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You have been contemplating, making a decision to sell structured settlement payments, looking for price quotes, providing documents and preparing for the court hearing.

Now to step five of the process of how to sell your structured settlement payments...

5. The court hearing

A court order to approve of your settlement transfer transaction is a must. If the buyer of your settlement payments tries to purchase your structured settlement without court permission, the purchase may be void from a legal standpoint and the purchaser may be penalized.

As ordered by all Structured Settlement Protection Acts, the court hearing is mandatory, and a judge needs to review the application and decide if the sale of your structured settlement payments is in your best interest. If the judge thinks it isn't, the structured settlement transfer will not be approved. 

The court session may need to be scheduled in your own state of residence, or even in your county, depending on your states laws governing structured settlement sales.

Whether or not you have to appear personally in court also depends on your own st ate. Some require it, some don't.

What the court will consider for approving your transfer

The judge will review your application, disclosures of the buyer of the payments to you, including a notification about independent professional advice.

The judge may also need to review the original structured settlement assignment and release papers.

In some states, the court should be notified about all previous proposals, transactions and attempts by you or by a buyer to sell / purchase your structured settlement payments.

Read more about this here.

What the judge may want to know about you

You will have to provide to the court your personal documents, including proof of income and evidence of your current need of money for the stated purpose.

The judge may need to assess your situation and get a personal impression of your ability to understand the move and make judgement about selling your structured settlement payments.

The judge will need to know your age, your status, size of family, sources of support and income and ability to provide for you and your family.

Most importantly, you'll need to explain why you need the money now, what you intend to do with the money and whether you'll able able to support yourself without the payment proceeds that you're selling now.

To sell your structured settlement payments, it must be in your best interest

To sum up. In order to get court approval...

  • the sale must be in your best interest
  • you must be able to understand the process and make decisions for yourself
  • you must be proposed a fair and reasonable price for selling your structured settlement payments
  • you should be able to support yourself and your dependents without the payments streams that you're selling
  • you may have to be able to manage a large sum of money without dissipating it
  • the sale should not be in contravention to statutory laws and court and government orders

Read here more about the court approval process for selling structured settlement payments here.

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