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Old 20.02.2010, 22:34
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use pension money for Mortgage

Hi
I want to use my pension money to buy a house.can I use my whole pension money in that??

thanks a lot
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Old 20.02.2010, 22:47
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Re: use pension money for Mortgage

As far as I know you can only use 3rd pillar pension savings. You can use all of these and I think you then get the benefit of using the same money twice. However I could be wrong....
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Old 21.02.2010, 00:46
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Re: use pension money for Mortgage

No you can use your 2nd pillar (the one all employees pay) as 3rd is not so common and is voluntary.

If you use this method though, when you sell the property, the pension fund 2nd pillar is immediately and fully reimbursed.

You can also use your pension fund as a guarantee in some cases, check with your mortgage provider. Insurance companies tend to give a slightly better deal than banks

If you use your pension fund for a property purchase it means you have less disposable income when you become of pensionable age; you can only spend it once !

Best way is find a good accountant, most of them will help you to save money

Last edited by Charlie R. Soles; 21.02.2010 at 00:49. Reason: spelling
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Old 21.02.2010, 09:41
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Re: use pension money for Mortgage

I cashed out my pension (2nd pillar) to by a house. Up until age 50, you can use your entire pension as downpayment on a house, after that only part of it. You will pay tax on it once you take it out. Once you sell the house, the money is required to be re-invested back in the 2nd pillar. The 3rd pillar can also be used to buy a house.
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Old 21.02.2010, 09:43
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Re: use pension money for Mortgage

What if you sell the house and buy another one immediately? Does the repayment still come into play?
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Old 21.02.2010, 10:52
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Re: use pension money for Mortgage

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What if you sell the house and buy another one immediately? Does the repayment still come into play?
No, providing the new house is more expensive than the original house you can just roll over what is essentially "a loan" from your pension fund.

The problems occur when you reach 65 and you need a pension which is tied up in your house.
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