Personal equity

Published by : dl

Personal equity

Your personal equity can come from various sources: your savings and investments, your pension fund, your 3A or 3B life insurance, a donation, a third party loan, an increase in the debt of a close family member, a building lot or personal construction.

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Savings and investments

The first sources of personal equity are generally your savings and investments.

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2nd pillar (occupational retirement planning) and 3rd pillar (private linked pension plan 3a)

If you look on the annual 2nd pillar statement, under the section "vested benefits" or "available assets," you will find the amount available for the purchase of property.

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Donations

A close friend or family member can help you with a donation or an advance on inheritance. DL MoneyPark can look into matters of inheritance, distribution during lifetime, and tax implications for you.

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Life insurance (unrestricted private plan 3b)

Surrender values of unrestricted life insurance policies can be withdrawn or pledged as equity. No tax is levied.

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Third party loans

A third party loan could come from a family member or friend. Certain employers also allocate loans to their employees. Drafting a written contract is esstential to avoiding conflict later on. The duration and interest rate of the loan need to be determined. You should know that the interest rate could be less than the one in effect.

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Increase in a friend or relative's debt

A friend or relative is already a property owner and has paid off a portion or his or her debt. You can increase this person's debt to raise cash for your personal equity. Your friend or relative will suffer no damage because you will be the one who pays the extra interest. Here, too, it is important to check the tax implications for all parties concerned.

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Building lot

When it comes to construction, the land plot that you already own through purchase, donation, advance on estate or by whatever other means is considered a part of your equity. The purchase price or market value of this land, reduced by potential debt, will be retained.

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Do-it-yourself work

During construction or renovation, you might choose to do some of the work yourself. This work can be considered, either entirely or partially, as part of your personal equity.

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Lack of personal equity

Despite all of your efforts, you still lack personal equity. What can you do? What options do you have to move forward with your project?

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