The Purchase Of A Pre Owned Annuity
What to look out for in the purchase of a Pre-owned annuity
A pre-issued annuity also known as a pre-owned annuity or a Secondary Market Annuity is simply an existing annuity that has been already sold by someone else usually for a discounted lump sum. Before a person can purchase a pre-owned annuity, however, a court order process is generally required to perfect the transfer of beneficial interest to the new purchaser.
There are a number advantages to purchasing a pre-issued annuity which include both a higher rate of return than a primary annuity (usually 4% to 6%); as well as the fact that most protections afforded to an original annuitant are transferred to the new purchaser of the annuity.
At the same though, there are additional risks. If someone is interested in purchasing a pre-owned annuity, it is critical for any new purchaser to have an expert and/or attorney assist throughout the purchase and transfer of rights. Specifically, an attorney should monitor the court order process to insure compliance with all applicable laws. Plus, the attorney should engage in all due diligence needed to insure that the transfer of rights under the existing annuity will inure to the benefit of the new purchaser.
At the Law offices of Eugene A. Ahtirski, we will review and under write your proposed pre-owned annuity purchase. We offer all investors an initial free consultation and will provide an initial review of all proposed purchase documents (not to exceed one hour) at no charge to you.