There are several ways for seniors to fatten their income when they are willing to give up their home. Mark Van de Woestijne put some possibilities one by one.
Who is willing to give up his house has some possibilities what his income to thicken.
in the past it was mainly childless elderly, who used it. More and more children realize that their parents are entitled to a comfortable life in exchange for their property.
Mark Van de Woestijne put some possibilities one by one.
sell
First of course you can just sell your property. Usually the buyer will receive the property itself to inhabit wishes, so that the seller continue on the rental market is appropriate.The seller will there have to consider that he now has its own capital, but this should be sufficient to allow to him are providing lifelong additional income, but also to pay the rent.If necessary, you can only sell the freehold and himself keep the usufruct. It becomes difficult to find a buyer that money to invest without being able to use the property or without receiving a rent. The risk in ordinary sale is that the life of (one of) the sales take longer than his money.
Selling on annuity
By selling annuity is usually sold the freehold and if you maintain the vendor (lifelong) usufruct. The buyer undertakes your monthly until death to you (you) a fixed sum (interest), rather than the immediate and full payment of the property.You ensure you establish a life in this way, monthly income and knows therefore exactly how much money you should monthly use up without running the risk that your life takes more than money. This is immediately solved a major rentier problem, as you are sure of a steady income, how long you live ... That risk is shifted to the buyer of the property, it will not know how much he will have to pay in total, since no one can foresee how long will enjoy year of his life and interest. He must consider the purchase annuity as a long term investment with an option to significant gains in premature death of the seller. The correct evaluation of this investment can be made only at the end. Usually an annuity located on a main (body) person, for example a single person. Nothing prevents multiple people - in practice usually married or undivided owners - together form the "body" to which the interest is established. Will have to be clearly defined, what happens to interest rates, after the death of one of them. The interest can disappear, be fully or partially transferred to the survivor (s).
Mortgage eats
In Belgium it can not, as long as the mortgage is not changed, but the government feels there for the reverse mortgage - such as exists in the Netherlands - also called eats mortgages also allow us.The principle of reverse mortgage is that individuals from the bank receives a sum of money with as collateral his own house or part of it. He will pass the amount borrowed, plus interest to repay on death or moving to a retirement home.
The risk is not inconceivable that someone got capital has exhausted his death and that the property is then sold by the bank, which he gets in trouble financially. The risk would have to pay is not imaginary. The heirs deficit Currently, 75% of Belgians own home. Now the problem of an aging population is increasingly going to ask, they can still be assured that they have a bone egg. Mark tHE WOESTIJNE - april 2007 - for Habitos.be
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