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Why Open Disclosure When Selling Structured Settlements Is Important…
Converting a structured settlement annuity is a simple solution for a beneficiary to receive cash in a large sum in exchange for the future payments of theinstallment plan. Many beneficiaries of structured settlements understand the advantages of obtaining all of their money now, versus needing to wait every month for a check. They often seek reputable companies that purchase annuities to obtain quotes or bids to convert their structured settlement into cash.
Structured Settlement Quotes
Both the Better Business Bureau(BBB), and the National Structured Settlement Trade Association (NSSTA),havestrict practices and guidelines for reputable companies that purchase annuity plans. These reputable companies follow those guidelines to maintain a clean track record when purchasing structured settlements from annuity beneficiaries.
The Importance of Open Disclosure
States nationwide have enacted protection laws as a way to regulate selling and buying structured settlement annuities. These enacted laws require that reputable third-party companies provide full and open disclosure to any potential customer wanting to sell their structured settlement. The disclosure must lay out every advantage and disadvantage of converting future payments of a structured settlement into cash. To make the process more protective for the beneficiary, most states require the signature of a judge as approval from the court before any conversion of an annuity into cash can be accomplished.
Other Important Disclosures
Reputable third-party companies in the business to purchase structured annuities are also required to be upfront about every factor of the sale. This includes detailing every expense involved in the process including court costs, document fees, attorney fees, and other. In addition, they must provide an exact accounting of the quoted discount rate, and the bottom line total amount of funds the beneficiary will receive from the transaction. This includes the gross amount minus all fees, along with the net amount that will be provided in a check.
Other important disclosures will be detailed information that includes the obligations of both parties (the purchaser and the seller) and all ramifications that are likely to occur if either side breaches the contract.
It is the belief of the state and the court system that the annuity beneficiary needs to feel comfortable about the entire process, while transferring ownership of the structured settlement. It is often highly recommended that the seller of the annuity listen to expert advice on all the advantages and disadvantages of selling a structured settlement. This helps to avoid any unexpected surprise or consequence.
Reputable businesses that purchase structured settlements typically have years of qualified experience in the process of transferring annuities. They all use various factors to consider the discounted rate that will be offered in the bid to the beneficiary and follow the strict open disclosure requirements.
The entire open process through a reputable company and the court system provides the opportunity for the beneficiary to understand exactly what they can expect. By using qualified third-party companies, the process of converting an annuity into cash can often be accomplished in 90 days or less.