What Is a "Living Inheritance"?
The Concept
Instead of waiting to pass on wealth after death, a "living inheritance" transfers financial resources to your children when they need it most - typically for purchasing their first home. This is accomplished by accessing equity in your existing property through a standard mortgage.
Traditional Inheritance
- • Children receive assets after parents pass
- • Often decades after they needed help most
- • May trigger significant estate taxes
- • Parents do not see children benefit
Living Inheritance
- • Children receive help when buying first home
- • Parents access home equity at low rates
- • Tax-efficient wealth transfer
- • Parents enjoy seeing children succeed
How Living Inheritance Works
Property Valuation
Your property is appraised to determine current market value and available equity.
Equity Release
Under Directive 451, you can access up to 70% of property value. Funds are released through a standard mortgage at favorable rates.
Transfer to Children
Funds are provided to your children as a gift or family loan for their down payment.
Manageable Repayment
You make monthly mortgage payments (or children contribute). Debt decreases over time rather than growing.
Benefits of Living Inheritance
Lower Interest Rates
Standard mortgages cost 4-5% vs. reverse mortgages at 7-8%. Significant savings over the loan term.
Debt Decreases Over Time
With each payment, the mortgage balance reduces. Unlike reverse mortgages where debt grows.
See Children Succeed
Experience the joy of helping your children achieve homeownership during your lifetime.
Preserve Estate Value
More wealth remains for inheritance compared to high-interest reverse mortgage alternatives.
Israel Residents Only
Directive 451 and Israeli mortgage regulations apply to Israeli citizens and permanent residents with properties in Israel. Have family in Israel who might benefit? Share this guide with them.
Ready to Help Your Children?
Let us assess your property equity and design an optimal living inheritance strategy for your family.
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Legal Disclaimer
The information and simulations presented on this website are for illustrative purposes only and do not constitute a binding offer for credit or financial advice. Credit Approval: Subject to final underwriting, clean credit data (positive credit score), clean banking history, and meeting the threshold requirements of the financing institutions. Interest Rates: The interest rates displayed are estimates only, based on average market data, and may change at any time according to the client's individual risk profile and economic conditions (Bank of Israel interest rate changes / CPI). No Commitment: RealFix does not guarantee loan approval or the terms displayed in the calculator. E&OE.
