Hana targets wealthy homeowners with reverse mortgage pension
'Hana The Next My Home Pension' offers lifelong income by leveraging home equity
Hana Financial Group has launched a new pension product aimed at enticing seniors to tap into their home equity through a private reverse mortgage.
The offering, "Hana The Next My Home Pension," targets homeowners whose properties exceed 1.2 billion won ($880,000) in declared value, which do not qualify for the government-backed reverse mortgage program from the Korea Housing Finance Corp.
'We developed this pension to help seniors prepare for the future as Korea undergoes a dramatic demographic shift, driven by the retirement of second-generation baby boomers and rising life expectancy,' a company official said.
The new program is available to individuals aged 55 or older and their spouses, who must also be at least 55 years old. Applicants must have owned the home, either solely or jointly, for at least two years and be residing in it at the time of the application. Owners of multiple properties are eligible.
The pension is structured through collaboration among Hana's affiliates. Homeowners entrust their property to Hana Bank, which manages it as a trust asset. Hana Life Insurance then provides lifelong monthly pension payments to both the owner and their spouse. Upon the owner's death, the right to receive payments transfers automatically to the surviving spouse, who continues receiving the same amount while living in the home.
Hana emphasized that pension payments are guaranteed for life, even if the total disbursement surpasses the property's value.
Liability is strictly limited to the trust-designated property. No claims will be made against heirs for any shortfall after the home is sold following the deaths of both policyholders, while any remaining proceeds from the sale will be passed on to them.
Customers can choose from several payout options: a fixed monthly amount, a front-loaded plan with higher initial payments or a gradually increasing payout over time.
To ensure long-term stability, a fixed interest rate is applied.
The product is part of Hana's broader "Hana The Next" initiative, launched in October to expand services for seniors. The program offers life care support across financial and nonfinancial areas, including retirement planning, inheritance and gifting and health management.
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Hana targets wealthy homeowners with reverse mortgage pension
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