Question about equity/capital life insurance

Hello everyone,

I have a question regarding equity:

I have had a capital life insurance with disability pension insurance running for 20 years and am considering building in the next few years. This life insurance has a guaranteed payout at the end of about €30,000 and a death benefit of €60,000. Is it possible to bequeath this insurance to my bank to receive €30,000 in order to increase the equity for building? Or is it only possible to pledge the insurance at the current surrender value? I think I have heard something about assigning the insurance to the bank and possibly buying it back piece by piece.

A more general question about construction financing:

Does it make sense for me (35 years old, unmarried (not yet), no children) to still enter Riester or rather a building savings contract, or a combination? Or maybe something completely different? My partner has had a Riester contract at Postbank for about 8 years with approximately €5,000 currently on it, can this insurance somehow be used for residential Riester? We have a joint income of approximately €6,200 gross.

Thank you very much,

Kerryman

Hello everyone,

I have a question regarding equity:

I have had a capital life insurance with disability pension insurance running for 20 years and am considering building in the next few years. This life insurance has a guaranteed payout at the end of about €30,000 and a death benefit of €60,000.
Is it possible to assign this insurance to your bank to receive €30,000 in order to increase the equity for building? Or is it only possible to borrow against the current surrender value of the insurance? I think I once heard something like this, assigning the insurance to the bank and possibly buying it back piece by piece.

Let me put it this way: there was, or is, a grey market where capital life insurances were sold. But before you seriously consider a "temporary" resale (someone also wants to make money from that), maybe think about what might be valuable in the insurance combination -> guessed correctly, the disability pension insurance (if it pays a decent disability pension). Surely the better option is to borrow against the surrender value. Beware, on average only 80% of the surrender value is recognized as collateral. Unfortunately, you do not write how much time is left on the remaining term of this contract.

A more general question about construction financing:

Does it make sense for me (35 years old, unmarried (not yet), no children) to start with Riester or better a building savings contract, or a combination? Or maybe something completely different? My partner has had a Riester contract with Postbank for about 8 years, currently with around €5,000 saved, is it possible to use this insurance somehow for residential Riester? We have a joint income of approximately €6,200 gross.

Thank you very much,
Kerryman

So a general remark on Riester and financing: Whether as a (good) residential Riester, as a combination of advance loan and residential Riester building savings contract, or as a classic Riester annuity loan, it simply makes sense. The saved interest, along with significant tax advantages with corresponding income, make the integration of Riester very, very interesting. Note: not only interesting for families with many children but also for tax class 1 (like you) candidates.

More questions and answers gladly via private message.
Best regards
Joachim