Structured Settlement & Annuity Sales Transactions
By Matthew M. Fischer - Associate - Urban Thier Federer & Jackson, P.A.
Background
Many individuals are entitled to structured settlement payments, also known as annuity payments. These payments are usually the result of a personal injury or wrongful death settlement agreement. The intent of such structured or annuity payments, versus a lump sum payment, is to provide a future payment stream and, arguably, to protect the payment recipient “from themselves” by not giving them all of the settlement money in one lump sum.
In reality, these structured settlements are usually the combined result of an uninformed plaintiff’s attorney and a defendant who rather pay a discounted amount to purchase a future payment stream versus paying a higher lump sum amount at the time of settlement. As a result, a settlement of $10,000 or even $1,000,000 on paper may only cost the defendant $5,000 or $500,000 out-of-pocket at the time of settlement.
The problem arises when the individual entitled to the payments encounters an unforeseen need for funds. Such a need can be an emergency, for example medical needs or a financial crisis. However, more often, it is the result of the individual’s desire to use the funds to benefit themselves and/or their family by paying for education, buying a home, paying off high interest debt, starting a business, and a host of other reasons. Unfortunately, the insurance and annuity companies obligated to make the structured settlement payments routinely refuse to make any early payments and rigidly enforce their annuity payment contracts. This leaves the individual who is entitled to the future payments, but who is in need of funds now, with few options.
To fill this need, a number of national companies have emerged which are in the business of buying these individuals’ future income/payment rights in return for a lump sum payment now. In order to protect these individuals, Florida law requires that they be represented by a professional, such as a Florida Bar licensed attorney, before they may enter into a contract to sell their future payment rights. Florida Statutes section 626.99296, as well as, United States Code Title 26 and Chapter 55 Section 5891 all regulate these transactions and, among other requirements, requires a “cooling off” period and approval by a Florida circuit court judge before the transaction can be finalized. Often these individuals can elect to sell all or just a portion of their rights.
Meeting the Individual’s Needs
Urban Thier Federer & Jackson, P.A. has assisted numerous individuals in selling their structured settlement payment rights. As most individuals are not in the financial position to pay an up front attorney retainer and wish to minimize the total attorney fees amount, Urban Thier Federer & Jackson, P.A. offers these individuals a flat fee option which is only paid if and when the individual’s transaction is approved by the court and funded by the buyer of the future payments. The flat fee covers contract review, counseling the individual to ensure that they understand the contemplated transaction, monitoring the transaction to ensure that it is set for hearing and that an order is entered by a Florida judge approving the transaction, and addressing, within reason, other matters that may arise in connection with the transaction. For example, on occasion the insurance company obligated to make the future payments will require additional documentation or even a contract and waiver to be signed by all parties to the transaction.
In many cases, Urban Thier Federer & Jackson, P.A. can handle the entire representation without the client having to physically come to the firm’s office. However, for those who can come to the office, the firm has notaries on site and all of the initial paperwork to get your transaction started can be completed in a short office visit of usually less than one hour. For those who are not able to come to the office, the entire representation can often be accomplished via telephone, email and/or fax. However, those individuals will also need to visit a notary and return the necessary documents to the buyer.
Conclusion:
If you are seeking to sell your future structured settlement payment rights, we encourage you to shop around among the national firms that are in the business of buying such rights. We also encourage you to become informed of your rights and obligations as a party to such a transaction. Given Urban Thier Federer & Jackson, P.A.’s extensive experience in representing individuals contemplating these transactions, we can provide you with professional, prompt and efficient service in order to help ensure that your transaction is finalized as quickly as possible and that you receive your funds.
We encourage you to explore our websites – www.urbanthier.com (English language) and www.urbanthier.de(German language) – to learn more about Urban Thier Federer & Jackson, P.A. and its attorneys and practice areas. Urban Thier Federer & Jackson, P.A.’s representation of structured settlement payments includes individuals throughout the State of Florida. We encourage you to become informed of your rights and options. You should also ensure that any law firm you consult or retain to represent you has the experience and knowledge to properly serve your needs.
Tags: Annuities, attorney, Florida, international, Law, law firm, Lawyer, Payment, Sale, Structured Settlement, Transaction