As reverse mortgages pick up steam in the United States, the financial product is also making an appearance in Central Europe.
Poland will now allow reverse mortgages, as the law on the home equity loan took effect Monday. To date, the country has lacked a legal framework to allow primarily retired people to unlock the value of their properties, according to Radio Poland.
In accordance with the law, Polish banks will now be able to buy properties from individuals in return for a lump sum or for payments in installments. The banks then recoup their money by selling the property following the previous owner’s death.
If the value of the property exceeds the sum of payments made prior to the owner’s death, the bank returns the difference to heirs, Radio Poland writes.
While the product is aimed primarily at retirees, the law does not specify a minimum age at which the product becomes available.
Read the Radio Poland piece here.
Written by Emily Study