For several years now, and lately more often, talking about reverse mortgage, also called a reverse mortgage. It is designed to help older people by providing them with additional funds, in connection with the agreement between natural persons or property owner and the financial institution. As a result, the oldest Member paid is frozen in real estate capital, eg in the form of installments.
The product is a financial proposal of the Ministry of Finance, which prepared a draft law for a reverse mortgage. Currently being consulted on the bill. It assumes that the property owner waives the right to her after his death, however, retains the right to freely dispose of it for life. The Bank has to pay the customer a certain amount of money, and securing a mortgage on the property.
It is the responsibility of the person who entered into an agreement with a financial institution is to maintain the property in proper condition. After the death of the owner, the property is transferred to a bank that can accept repayment of the loan by the heirs, or sells property - in this case the heirs would receive the difference between the amount of the loan and the amount received from the sale.
To be able to conclude a reverse mortgage mortgage should meet several conditions, including have the right to the property, maintain it and its value, dwell in it, and be in the right age to be eligible for the credit. The amount of benefits paid will be different for men and women, therefore, due to the shorter expected life of the lives of men, the installments paid to them will be much higher than for women. In addition, the greater the chances of reverse mortgage holders have single-family homes made regardless of the location and the apartments in a good location.
The aim of the Act is to establish the safety and transparency of transactions, so that the reverse mortgage was used and offered by the controlled and supervised institutions, such as banks. Currently, similar to a reverse mortgage instrument, offer the company - mortgage funds, in the form of a life annuity with a mortgage or by a contract for life. It is regulated by the provisions of art. 903 and Art. 908 of the Civil Code. Senior security interest so that only the Civil Code and the Code of Civil Procedure. In this form, the rules may pose some risk for the elderly, through an ambiguous definition of the rights and obligations of both parties. In addition, in connection with a contract for life, the owner loses the right to the apartment or house, thus heirs will not have after his death, the right to property.
How important seems to be the legal regulation of the institution inverted mortgage is the fact that the Office of Competition and Consumer Protection initiated against one of the companies procedure for registration of prohibited clauses, five of the provisions contained in agreements for life of the company, which grossly violate the rights of consumers.
Reverse Mortgage, if you will additionally fortified planned law gives older people the opportunity to improve their financial situation and increase the sense of security. Perhaps an alternative to reverse mortgages will also have a positive effect on the desire to help seniors by the immediate family.