The Structured Settlement Protection Act of 2002 was instituted to protect those who had been awarded structured settlement money and had a desire to sell part or all of it for a lump sum. Basically, it demands that any transactions conducted by a factoring or structured settlement loan company must be approved by a state court to make sure the transaction is in the best interest of the client and the client’s dependents.
2010 was a great year for most structured settlement factoring companies. Record low rates created attractive propositions for annuitants, a struggling economy was a catalyst for more annuitants to sell their annuities, and ample investor funds supported the influx of cases. It was the perfect storm for many of the companies within the industry.
Towards the end of 2011, some structured settlement factoring companies could see their demise.
Below are 5 predictions for the structured settlement factoring industry for the upcoming year.
On May 26th, 2010 Judge Norma Ruiz denied a request for court approval to transfer future structured settlement payment rights to Settlement Funding of New York, LLC (Peachtree Financial). The opinion, seen here, is a direct response to the “cash now” advertising of this company. It’s good to see a judge take the time to enforce the Structured Settlement Protection Act as noted by this author.
In this video, Andrew Cravenho, President of the Settlement Quotes, LLC Structured Settlement Factoring Exchange is interviewed by John Darer of the Legal Broadcast Network. Viewers can learn how a Structured Settlement Factoring Exchange is a viable option to use when selling structured settlement payment rights.
What is the servicing of structured settlement payments?
The servicing of structured settlement payments occurs when an annuitant enters into a structured settlement factoring agreement in which the annuitant chooses to split one or more payments and the factoring company becomes the payee of the entire payment. Once the factoring company receives the entire payment from the insurance company, they keep their agreed upon amount and pay the annuitant their portion.