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Everyone is looking for financial security everywhere these days which has left many turning to selling their structured settlements to do so. Since the economy is in the state that it is in, many people have become more cautious with their money and how they spend it. Even with people being so cautious and pinching those pennies diligently, money is often tight and does not reach throughout the month which takes a toll on the individual. Selling the structured settlement has provided a sense of relief to some but has not come without legal factors.
When considering selling a structured settlement, some may wonder if it is legal to sell a structured settlement. It is completely legal to sell a structured settlement. To protect the owners of structured settlements who are looking to sell, most states have enacted the Structured Settlement Act. You can view this protection act online or with the structured settlement buyer. However, it is important to be familiar with this law in your state so that you will have an idea of what the structured settlement buyer can and cannot do.
A legal factor that most structured settlement sellers are not aware of is the anti-sale clause. This clause is usually insisted upon by structured settlement funding companies to protect those that have a medical condition or benefactors that will require guaranteed monetary benefits in the future. This anti-sale clause will prevent some from selling their structured settlement. However, remember that this clause is put into place to protect you in the future.
Another legal factor that one needs to remember when selling a structured settlement is the courts. They have the authority to say whether or not a structured settlement can be sold even if there is an anti-sale clause included in your structured settlement. If the courts deem that the need for a lump sum cash buyout is bigger than the payments that one receives, then more than likely they will approve the sale of the structured settlement.
You do need to keep in mind that the court has the right to disapprove the sale of the structured settlement as well. Should the judge who is considering the case decides that the need for the lump sum cash is not as important as the need for the future payments, he may very well deny the sale. If there is an anti-sale clause added to the structured settlement, then more than likely the judge will take a closer look at the circumstances surrounding all requests in the case.
Yet another legal factor to consider is taxation. Most structured settlements are tax free if they are settled as a payment plan. However, the minute you decide to sell that structured settlement the taxation becomes a whole totally different ballgame. It is advisable to take into consideration hiring a financial adviser who can tell you what the Revenue laws are in your state and pertaining to your structured settlement.
Another legal factor is that no legal party can enter into a legal contract with a minor. Structured settlements that belong to a minor can be sold with the intervention of a parent or legal guardian. However, the courts are more likely to still impose stricter limitations because of the fact that a minor is involved. Usually the only excuse a judge will take into consideration when selling a structured settlement of a minor is the extreme medical factor.
Usually selling a structured settlement is easy to do. However, you do need to know that there are legal factors that could possibly change the outcome of the sale. So be prepared if you are considering the sale of your structured settlement.