Life happens, and sometimes one needs other people’s capital to fund the purchase of that dream house or the expansion of a business. However, at some point, the other people, usually represented by the bank, will want to have their money back. And if you are unable to repay the loan because you are deceased, disabled, or retrenched, they will sell the house or business to get the money back.
But for a long time, the easiest and cheapest way to ensure that your estate has the money to repay the loan has been to insure the mortgage bond or business loan with a policy on your life. It then becomes payable in the event of you dying or becoming disabled, thereby generating the capital to repay the loan and leave the house for your loved ones, or to leave your business intact.
However, it is very important that the life policy insuring the loan is set up correctly to make sure the money in the end goes to the lender, and to avoid additional taxes on your estate.
How we can help
We can help to make sure:
- the agreements underpinning your business loans are correctly structured
- your policy and your Last Will and Testament talk to each other and don’t contradict each other
- your estate doesn’t pay unnecessary taxes because the policy was incorrectly set up
- you pay an appropriate price for the policy benefits which you choose.