Pension Buyout Company Terms - and Distrusted Pension Buyers
Searching around on the net, I've been able to compile the following information of what military / government pension factoring companies offer / demand for pension buyouts. It may be partial. Others, please fill in the voids.
* They would offer to buy out pension payment streams over a certain amount of years
* They would request a minimum monthly / annual pension payment value in order to buy it out
* They would offer to buy out pension from police officers, firefighters, retired vets of the armed forces, teachers....
* They would require a credit background check and approve only applicants with good credit
* They would require that the pensioner holds or buys a life insurance policy
* The pensioner must be employed to sell his / her pension
* They would exclude active duty VA pension as not qualifying for a buyout
* They would refuse to buy out social security payments
* They would return COLA increases to the pensioner's account as they are not allowed to keep them
Additional comments: what catches my eye is that a number of such pension transfer companies now are posting alerts on their websites that they have ceased to accept applications and offer quotes for military / government (or general) pension buyouts. They apparently do not offer any more this service.
One wonders if this is because of closer scrutiny and crackdowns by authorities on pension buying practices.
What alerts me even more is that at least some of these pension payment buyers don't seem to be very credible if to base on the quality of their websites.
One pension buying website, for example, concludes their guidance and terms for the pension assignment with a paragraph suggesting that while they don't offer anymore pension buying quotes, one can take a look at ads placed on that page for other companies that do buy pensions.
To be sure, this website is getting paid when you click on the ads, to my best understanding.
A deeper look into the pages of that website reveals to me that they are not limiting themselves to buy pension payments but are affiliated with a host of other funding programs. At the end of a page listing those programs you are advised to click a link for more information. That link leads you to a different website.
I have more to add regarding my experience on that "pension buying" company's website (its domain name suggests that it's about selling pension), but I figure the above should be enough to get the point.
Bottom line: I would not sell my pension to companies like those even if allowed to by law. I would not trust them.
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