If you want to cash structured settlement payments for money now there is definite value in independent professional advice (IPA). If you are considering selling your annuity and you’ve done some research you may have heard this term and wondered what it means or if it is something that is required. Really, the term “independent professional advice” is really just a term that means consulting your own attorney or financial advisor. This is not something that you are always required to do, though in some states you may have to.
The Legality of Selling Your Settlement
When you cash structured settlement payments in there are almost always certain legalities which require a lawyer. In most cases the company that is purchasing your payments will hire a lawyer and take care of all legal issues. This lawyer, in some cases, will speak with you and let you know what to expect at the hearing. However, some states require you to get your own independent professional advice – so that you can be certain that you are getting advice that is best for you, not anyone else. The only way to guarantee this is to find, hire and pay for the IPA yourself.
Getting IPA Yourself
Independent professional advice (IPA) can be independent legal advice (ILA) provided by a lawyer, or it can be provided by another professional such as an accountant or financial expert. IPA is recommended to those who want to cash structured settlement payments in before the transaction is completed, whether it is required or not.
In some states, an IPA is required to make sure that the annuitant (seller) is aware of what they are doing and to make sure that the seller has thought about whether the transaction is in his or her best interests. In most states an IPA is highly recommended, but it can be waived if the seller chooses not to get it.
The following states require independent professional advice for the annuitant before you can cash structured settlement payments in:
- Alaska
- Delaware
- Louisiana
- Maine
- Maryland
- Minnesota
- North Carolina
- Ohio
- Vermont
An IPA usually does not cost more than $500; it is the seller’s responsibility to cover the cost of their IPA in most situations. However in the state of California, if the annuitant (seller) would like to get IPA, then the factoring company is obligated to reimburse the annuitant up to $1,500.
When you cash structured settlement payments in, usually one of the documents that you are asked to sign is a form that gives the seller the option to waive or obtain IPA. If the seller gets IPA, then the seller must provide the contact details of the professional that gave the IPA. If the seller waives getting IPA then he or she will just say that on the form. Then, the court order will confirm whether or not the seller obtained IPA or waived it, and if this is acceptable.
Certainly, an IPA will cost you some money. However, getting an IPA is a good idea to help you be certain that you are making a wise financial decision. Strategic Capital always encourages you to get independent professional advice before committing to the sale of your structured settlement payments.
