We welcome Good Finance to this blog, pioneer and leader in Spain offering financial solutions to the elderly ; He has been advising on products for over 15 years. Each specific case best fit the different needs of the elderly.
On this first occasion they will talk about different products that allow us to obtain liquidity thanks to our real estate assets.
Currently, many older people do not have the necessary financial resources to finance their stay in a Residence . Moreover, taking into account the current crisis situation in which many pensions have been frozen, there have been and planned cuts in health and social policies that until now solved the problem of many people who needed to move to a Senior Center or get a home help. Even on numerous occasions it is the children of our elders themselves who desperately seek a way to obtain financing to be able to provide financial assistance to their parents.
As an alternative to these situations there are financial products that can provide you with a solution:
Each product has different characteristics that adapt to the different circumstances in which the elderly person is, but all three allow the pension to be supplemented with extra monthly income and for a lifetime.
The Real Estate Life Annuity is a contract whereby an elderly person receives a monthly pension for the rest of his life, in exchange for the transfer of ownership of his home but maintaining the right to use and enjoy it. This formula is intended primarily for people over 65 , owners of apartments that are generally free of charges, and who wish to live their best with their own financial resources through proper management of their real estate assets and, all this, without losing the reference that supposes to continue living in his house of always . In addition, if the elderly person renounces the usufruct of the home to move into a Residence, the monthly income would increase considerably. In this way, the elderly person can hire a Life Annuity while still living in their home and thus pay, for example, the home assistance they may need and when they want to move to a Residence, while increasing their monthly income.
Reverse Mortgage is a loan
On the other hand, the Reverse Mortgage is a loan with mortgage guarantee for people over 65 who own a home, through which the financial entities and insurance companies that sell them pay these people a monthly rent, with the particularity ( and hence its denomination) that the elderly person does not have to return the amounts received or interest in life as with a normal mortgage, but that the debt is accumulating and its cancellation is postponed upon the death of the contracting party. With the Reverse Mortgage, the elderly person insures a monthly income without losing ownership of their home . Therefore, you can also continue to live in your home and when you want to move to a Residence, however with this product your income will not vary.
Plan the investment of the capital
Finally, by means of the Good Lender , the elderly person can plan the investment of the capital that he has obtained, for example, from the sale of his house to also ensure the collection of a monthly rent for a lifetime . It is a life-saving insurance modality in which an insurance company guarantees the contracting party the collection of a periodic income until his death (lifetime mode) or during the period established (temporary mode), in exchange for the payment of a single premium , that is, for the contribution of an amount of money / capital only once. That income (generally monthly, although it can also be received quarterly, semiannually or annually) that the insurance company will pay includes the payment of interests that can become very attractive, and that currently are paid at a higher annual interest rate at 3% .
In any case, the problem of how to pay the fees of a Residence when you do not have the necessary capital would be solved for all those older people who decide to monetize their real estate assets , that is, their housing through a Real Estate Life Income, of a Reverse Mortgage or a Life Insurance.