§ 25-3104.Transfer of payment rights; court order; requirements.

Article 31: Structured Settlements Transfers Protection Act and Nebraska Statutory Thresholds for Settlements Involving Minors Act · Last amended 2001 · Last verified July 22, 2026

In one sentenceThis section requires a Nebraska court to approve any transfer of structured settlement payment rights in advance, based on written findings that the transferee gave the payee a detailed disclosure statement, the transfer serves the payee’s best interests, and several other listed conditions are met.

Full Text of § 25-3104

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(1) No direct or indirect transfer of structured settlement payment rights is effective, and no structured settlement obligor or annuity issuer is required to make a payment directly or indirectly to a transferee of structured settlement payment rights, unless the transfer has been authorized in advance in a final order of a court of competent jurisdiction based on the court's written express findings that:

(a) The transfer complies with the requirements of the Structured Settlements Transfers Protection Act;

(b) The transferee has provided to the payee a disclosure statement in no smaller than fourteen-point type specifying:

(i) The amounts and due dates of the structured settlement payments to be transferred;

(ii) The aggregate amount of the payments;

(iii) The discounted present value of the payments, together with the discount rate used in determining the discounted present value;

(iv) The gross amount payable to the payee in exchange for the payments;

(v) An itemized listing of all brokers' commissions, service charges, application fees, processing fees, closing costs, filing fees, referral fees, administrative fees, legal fees, notary fees, and other commissions, fees, costs, expenses, and charges payable by the payee or deductible from the gross amount otherwise payable to the payee;

(vi) The net amount payable to the payee after deduction of all commissions, fees, costs, expenses, and charges described in subdivision (1)(b)(v) of this section;

(vii) The quotient, expressed as a percentage, obtained by dividing the net payment amount by the discounted present value of the payments. Such quotient shall be disclosed in the following statement "The net amount that you will receive from us in exchange for your future structured settlement payments represents ....% of the estimated current value of the payments.";

(viii) The effective annual interest rate. Such rate shall be disclosed in the following statement "Based on the amount that you will receive from us and the amounts and timing of the structured settlement payments that you are turning over to us, you will, in effect, be paying interest to us at a rate of ....% per year."; and

(ix) The amount of any penalty and the aggregate amount of any liquidated damages, including penalties, payable by the payee in the event of a breach of the transfer agreement by the payee;

(c) The transfer is in the best interests of the payee, taking into account the welfare and support of the payee's dependents, and the net amount payable to the payee is not unfair, unjust, or unreasonable under existing circumstances;

(d) The payee has received, or waived his or her right to receive, independent professional advice regarding the legal, tax, and financial implications of the transfer;

(e) The transferee has given written notice of the transferee's name, address, and taxpayer identification number to the annuity issuer and the structured settlement obligor and has filed a copy of the notice with the court;

(f) The transfer agreement provides that any disputes between the parties will be governed by the laws of Nebraska and that Nebraska is the proper place of venue to bring any cause of action arising out of a breach of the agreement; and

(g) The transfer does not contravene any applicable statute or order of any court or other government authority.

(2) The court may not authorize a transfer if the court makes an express written finding that the transfer contravenes the public policy of this state.

(3) The transfer agreement shall also provide that the parties agree to the jurisdiction of any Nebraska court of competent jurisdiction. If the transfer would contravene the terms of the structured settlement or the standards set forth in subsection (1) or (2) of this section, the court may grant, deny, or impose conditions upon the proposed transfer as the court deems just and proper under the facts and circumstances, upon the filing of a written objection by any interested party and after considering the objection and any response to it. Any order approving a transfer must require that the transferee indemnify the annuity issuer and the structured settlement obligor for any liability including reasonable costs and attorney's fees arising from compliance by the issuer or obligor with the order of the court.

(4) A provision in a transfer agreement giving a transferee power to confess judgment against a payee is unenforceable to the extent the amount of the judgment would exceed the amount paid by the transferee to the payee, less any payments received from the structured settlement obligor or the payee.

(5) With respect to a transfer of structured settlement payment rights a transferee may not contract for or receive a discount or finance charge that would result in an effective annual rate in excess of the maximum interest rate per year applicable in Nebraska to a consumer loan as set forth in section 45-101.03.

Source

Laws 2001, LB 55, § 4.

Plain-English Summary

Section 25-3104 is the heart of the Act. No transfer of structured settlement payment rights takes effect, and no annuity issuer or structured settlement obligor has to pay a transferee, unless a court has authorized the transfer in advance through a final order with written findings. Among those findings: the transferee gave the payee a disclosure statement, printed in type no smaller than fourteen point, spelling out the payment amounts and due dates, the aggregate and discounted present value of the payments, every fee and commission the payee will pay, the net amount the payee receives, what percentage of the discounted present value that net amount represents, the effective annual interest rate the deal amounts to, and any penalty for breaching the transfer agreement.

The court must also find that the transfer serves the payee’s best interests — taking into account the welfare and support of the payee’s dependents — and that the net amount paid is not unfair, unjust, or unreasonable. The payee must have received independent professional advice about the transfer’s legal, tax, and financial effects, or knowingly waived that advice. The transferee must have notified the annuity issuer and obligor of its identity and filed that notice with the court, the transfer agreement must choose Nebraska law and venue, and the transfer cannot violate any statute or existing court order.

A court cannot approve a transfer it finds would contravene Nebraska public policy. Where an interested party objects, the court may grant, deny, or condition the transfer as it sees fit, and any approval order must require the transferee to indemnify the annuity issuer and obligor for costs and fees arising from the order. A clause letting the transferee win a confessed judgment larger than what it paid the payee, minus payments already received, is unenforceable to that extent. And a transferee cannot charge a discount or finance charge that pushes the effective annual rate above the maximum rate Nebraska allows on a consumer loan.

Frequently Asked Questions

Can a structured settlement recipient sell their payment rights without going to court?

No. Section 25-3104 makes a transfer ineffective, and bars any payment to the transferee, unless a court has authorized it in advance in a final order with written findings.

What must the disclosure statement tell the payee before a transfer?

The payment schedule and amounts, the aggregate and discounted present value of the payments, an itemized list of every fee and commission, the net amount the payee will receive, what percentage of the discounted present value that represents, the effective annual interest rate, and any breach penalty — all in type no smaller than fourteen point.

What must a court find before approving a transfer?

Among other things, that the Act’s requirements were met, the payee got the required disclosure, the transfer serves the payee’s best interests and is not unfair or unreasonable, the payee received or waived independent professional advice, and the transfer does not violate any statute or court order.

Can a court deny a transfer even if the paperwork is in order?

Yes. The court cannot authorize a transfer it finds would contravene the public policy of Nebraska, regardless of whether the disclosure and notice requirements were otherwise satisfied.

Is there a cap on the effective interest rate a transferee can charge?

Yes. The discount or finance charge cannot push the effective annual rate above the maximum interest rate Nebraska allows on a consumer loan under section 45-101.03.

What happens if the transfer agreement lets the transferee win a judgment larger than what it paid?

A confession-of-judgment clause is unenforceable to the extent the judgment would exceed what the transferee paid the payee, minus any payments already received.

Source & verification. Section text and the amendment-history citation are reproduced verbatim from the Nebraska Legislature, Revisor of Statutes, enacted by the Nebraska Legislature. Last verified July 22, 2026. · Official source

Also known as: structured settlement court approval nebraskaselling structured settlement rights court orderdisclosure statement structured settlement transferstructured settlement discount rate cap nebraska