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Old 14.05.2020, 21:07
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Pledged Pillar 3 funds

Can I please clarify something. If I pledge my current pillar 3 funds towards a mortgage, what happens to those savings upon my retirement age. Does the bank keep hold of them as their security or those the term expiry and I am free to use the funds
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Old 14.05.2020, 21:16
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Re: Pledged Pillar 3 funds

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Can I please clarify something. If I pledge my current pillar 3 funds towards a mortgage, what happens to those savings upon my retirement age. Does the bank keep hold of them as their security or those the term expiry and I am free to use the funds
Whilst they are pledged you can't touch them.
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Old 14.05.2020, 21:36
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Re: Pledged Pillar 3 funds

Thatís my question are they pledged for the entirety of a mortgage I.e forever.

Or Is there a term limit on the pledge and after it expires repayments May increase
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Old 14.05.2020, 21:40
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Re: Pledged Pillar 3 funds

Put another way:
  • If your 3rd pillar funds are not pledged, they you have free access to them upon reaching retirement age.
  • If you have pledged them, you have free access to them only once that bond has been fulfilled (in your example, once the mortage has been paid in full). Therefore, "reaching retirement age" is no longer the relevant factor to gain free access.
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Old 15.05.2020, 15:11
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Re: Pledged Pillar 3 funds

Whatever you pledged using indirect amortization is used to repay the mortgage when the mortgage is due, or latest at retirement age (and is taxed accordingly).
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