Catherine Byerly, Writer
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APA Byerly, C. J. (2020, May 18). Uncovering 7 Common Annuity Selling Myths. Retrieved July 6, 2022, from

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Chicago Byerly, Catherine J. "Uncovering 7 Common Annuity Selling Myths." Last modified May 18, 2020.

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You may never consider selling your annuity payments until you’re in a bind. When your life circumstances change and you suddenly find yourself in need of money, selling annuity payments certainly can become an option.

But what about all the confusing information on the Internet about selling? Relax, we’ve got it all figured out for you.

Here are the most common myths we hear about selling payments:

Myth 1: You have to sell all your payments at once

False. The majority of people only sell a portion of their payments, not all of them in one transaction. Most annuity buyers in the secondary market understand that, and probably will work with you even if you only want to sell one payment.

In fact, in most circumstances it is in the best interest for both you and the buyer for you to only sell a portion of your payments. The buyer gains you as a customer, and you hold on to some of your payments for a rainy day.

Myth 2: Judges don’t want to approve payment sales

Not true. Judges want to help but have an obligation to prevent bad transactions from happening. The judge’s duty is to look out for you. Once you decide to sell a reputable structured settlement company will help you get all your paperwork in order so that it will be approved by the judge.

Myth 3: Every sale must go to a judge

Nope. You may not even need to worry about a judge at all. There are several kinds of annuities and not all need court approval. Only structured settlements and lottery payments need to go through a judge in a process that typically takes around 12 weeks.

Myth 4: Payment sales are instant, over-the-phone transactions

Although the process can be fairly quick, it’s not like taking a cash advance from a credit card, although you may be able to get some of the money in just a few days. Annuities are a great long-term investment, but they can be complicated. Thus, you’ll want to have an experienced company walk you through the selling process, which can take around 12 weeks for structured settlement annuities and lottery annuities and a few days for single-premium annuities.

The process works like this: You call a company to get a quote, decide if that quote works for you, and then the company starts the process. If you need cash, a well-established firm that purchases structured settlement payments should be able to work with you to provide a cash advance. (Click here for more on the selling process.)

Myth 5: You need good credit to sell your payments

Whether you have a credit score of 350 or 700, it doesn’t make a difference in selling your payments. Some people think that selling your annuity payments is like getting a traditional bank loan: You apply, get your credit checked and find out if you’re approved.

But that’s simply not the case. Selling your payments is simply a way of accessing money that’s already yours and the transaction isn’t considered a loan.

Myth 6: Every company charges hidden fees

“Hidden fees are no big deal,” said no person ever! A reputable company should explain up front how everything will work when you sell your payments. Sure, sometimes the process requires attorney and court fees, but those costs are disclosed before you make your decision.

Myth 7: Once you win a lottery or casino annuity, you’re stuck with the payment terms

Not true! There are a lot of great reasons to take lottery or casino winnings in the form of an annuity — but sometimes life happens and you need that money now. Some people are under the (false!) impression that once they select a long-term payment option they can never get a lump sum of cash.

By selling scheduled annuity payments you can get access to a lump sum of cash and still keep a portion of your payments too.

The bottom line is that when you’re ready to sell, turn to a trusted buyer of payments for the best advice, and don’t believe everything you read online!

Please seek the advice of a qualified professional before making financial decisions.
Last Modified: May 18, 2020