Real estate financing

Did you know that you can already use your 2nd pillar pension today to acquire property in a private capacity? This is how we help you realise your property project. A life insurance policy can be used in the context of property financing, as a means to reconstitute the borrowed capital, as additional movable collateral, or as a financing tool. The supplementary pension can be used as a completely standalone credit solution for the whole, or as leverage in credit negotiations as part of the financing solution. The legislation offers several ways to finance property through 2nd pillar insurance:

An advance on the policy means that the insurer, at your request, pays out early a part of the pension reserves you have already built up in your supplementary pension plans, in the context of your property project. Depending on the insurer and the product, interest is or is not charged on the advance, and the advance does or does not continue to accrue interest within the supplementary pension plan. On average, you can count on around 65% of the existing reserves being available for property purposes, with an average cost of 1% per year on the amount withdrawn.

A pledge of the pension reserves means that a part of the acquired final capital of your pension plan is pledged with your financial institution (bank or insurer), which provides a bullet loan for the property transaction. Your supplementary pension plan then serves as security for the repayment of the bullet loan. During the term of the bullet loan you personally only pay interest to the financial institution, while the reserves in your pension plan continue to grow. The borrowed capital can always be repaid in whole or in part during the term of the loan. If that does not happen, and you do not repay the borrowed capital with other means on the maturity date of the bullet loan, then the pension capital of your supplementary pension plan is paid out (possibly in part) to the financial institution to settle the outstanding amount of your loan.

A loan through reconstitution, or reconstitution loan, means that your 2nd pillar insurance (group insurance, IPT, VAPZ, POZ) is used to reconstitute the borrowed capital of the mortgage loan with your financial institution (usually an insurance company). During the term of the loan you personally only pay interest. Your pension build up in your pension plan meanwhile continues to grow. This construction has many similarities to the combination of pledge and bullet loan above, but with one important difference: you do not pledge your acquired reserve at the end date, but the planned final capital in your policy, taking into account the future payments. We can therefore align your premium payments in your 2nd pillar insurance with the borrowed capital.

Anyone with a pledgeable 2nd pillar contract (VAPZ, POZ, IPT, group insurance). For an advance, it is important that there is sufficient reserve present in the contract (that is: that enough has been saved in the contract).

That some 2nd pillar contracts in the form of a pension fund (e.g. certain RIZIV (the national health and disability insurance institute) contracts for physicians) are not pledgeable for property?