Selling Annuity Payments: A Guide

If you're thinking of selling annuity payments or other structured settlements, but are unsure how to sell future payments you may receive in exchange for a lump sum of cash, here are some tips on how to make a financially sound decision.

Fear Not the Sale of the Annuity

Do not be afraid about selling your annuity if you just learned it was possible. Do your research on the market or hire a financial consultant of some kind if you lack the time to do so. You can have a cautious attitude but do not be overly skeptical. The sale of annuities is an accepted and approved process in all 50 states.

“Quote Me A Price”

Various buyers (legitimate, official funding companies) will bid on your annuity and there are also companies that will help market your annuity so that you get the largest lump sum possible. The first mistake sellers make is selling to the first company that bids on their annuity. To initiate this process, you can simply contact the companies and ask them to quote you a price.

Decide Whether or Not You Want To Sell All or Part of Your Annuity

Many sellers do not realize that they do not have to sell their entire annuities. You can opt to sell just part of it and continue to receive annuity payments. This decision can be based on how much cash you need now, and also based on how important fixed income checks of at least a certain amount will be to you in the future.

Have the Sales Contract Reviewed by an Attorney

If the company with the lowest bid seems less reputable or trustworthy than another, try negotiating a the best deal possible with the company with which you feel more comfortable about the prospect of doing business.

Even once you've found a company that seems legitimate and has an excellent bid, you should have your attorney or financial adviser review the sales contract carefully on your behalf. While this is a serious decision you are making, with due diligence and prudence it can be done to great avail. Fine print is important, though.