With the replacement of the physical Token by the LuxTrust Mobile application, borrowing the Token from your parents or any other person to make their payments or bank transactions is no longer possible. It is simply not legal. Using someone else's Token, even with their consent, is comparable to borrowing an identity card, which is strictly forbidden. Payments can still be made, but in a more secure and legal way. We give you some advice on how to do this in this article.
Understanding residual debt insurance!
You've probably heard of residual debt insurance. But what does it mean and do you need it?
Residual debt insurance is a type of risk insurance used for a mortgage loan or personal loan to cover debt. Thus, in the event of death of the insurer, the capital, which is limited to the term of repayment and the outstanding balance of the capital, will be paid to the beneficiary of the insurance.
Beneficiaries may be either the lending institution, notably the bank, or the spouse or children of the insured. On the one hand, residual debt insurance protects the family of the insured and their estate. Indeed, it avoids members of the family having to take on a heavy financial burden, or having to sell the property for which the insurance policy was taken out.
Let us look at a model example: Imagine a person who has a family and children. In this case, the loan holder’s death could have a significant effect on the family estate by impacting the monthly available income. Moreover, the deceased’s debt could considerably burden his or her heirs. In this case, opting for residual debt insurance is interesting, and should cover an amount that is sufficient to avoid a deficit at the sale of the property. Also, the insurance is cheaper for young customer’s and offers interesting tax-deductible amounts.
As each home loan application is unique, it is difficult to know if you fall within one of the two above categories. Moreover, there are many different death insurance options, which differ according to the insured persons, the amount to be insured and the term, additional guarantees (for example mixed life insurance) and the payment of the insurance premium (single premium or annual). It is thus a good idea to review your options with your Housing Advisor at the bank, who will help you find the solution most suited to your personal situation.