New solution unveiled for seniors looking to raise funds

New solution unveiled for seniors looking to raise funds
New solution unveiled for seniors looking to raise funds

DomaCom, a fractional investment platform, has rolled out a new model for seniors’ equity release that takes a different approach to the reverse mortgage model or Government Pension Loan Scheme.

According to the company, instead of raising a debt where the interest is capitalised against the property like a reverse mortgage, “the fractional model is a shared equity structure, meaning that seniors can sell part of their property to one or more investors while remaining in the property for as long as they want.”

“It is an ASIC-registered financial product that operates in similar fashion to a syndicate,” said DomaCom Marketing Manager, Warren Gibson.

“The only difference is that the title stays with the owner, and DomaCom protects the investors’ interest with a mortgage instrument over the property. When the senior decides to sell the property, the investors will receive a share of the net sale proceeds in proportion to the amount they invested.”

DomaCom has launched a campaign to gather expressions of interest from seniors “who would prefer to access equity in their home instead of raiding their superannuation or selling other assets.”

The company is hoping that demand from seniors may also fuel interest in funding equity release by some of Australia’s larger financial institutions, as well as bring the senior financial advice demand to the fore for financial planners and government.

Tags: 
Finance Senior Citizens

Comments

Be the first one to comment on this article
What would you like to say about this project?