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Family Office Mortgage

Compare

The comparison

The program beside a traditional jumbo mortgage and beside paying cash, for your own price.

Enter a price and both comparisons are recalculated for it.

Compare against

A $4,000,000 purchase, against a traditional 30-year mortgage.

Illustration

The bottom line, projected through year 62

You put in $4,928,000. The policy is projected to pay $4,891,789 of your mortgage, then pay you $12,498,211. Everything you put in comes back, and $7,570,211 more.

A traditional mortgage on the same home takes $7,781,060 from you over 30 years.

Traditional mortgageFamily Office Mortgage

At purchase

Down payment$800,000$800,000
Policy contribution—$1,200,000
Total committed$800,000$2,000,000

Years 1 to 15

Monthly mortgage paymentProgram: interest only$19,391.83$16,266.67
Mortgage balance at year 15$2,283,356$3,200,000

Years 16 to 30

Monthly mortgage paymentProgram: principal and interest over 15 years$19,391.83$27,176.61
Projected policy cash, per year—$370,000
What you pay, per month$19,391.83$0 projected
Projected cash left over, per year—$43,881

Year 31 onward

Mortgage paymentsNoneNone
Projected policy cash, per year, through year 62—$370,000
Quoted remaining death benefit—$2,600,000

The whole picture, through year 62

Total you put in$7,781,060$4,928,000
Mortgage payments made by the policy, projected—$4,891,789
Projected policy cash paid to you, years 16 to 62—$12,498,211
Cash received, less cash put in−$7,781,060+$7,570,211 projected

Illustration. Both cases assume a 6.1% mortgage note rate, a 20% down payment, and no investment of money kept or saved. The program’s projected policy cash is a quoted figure scaled to the policy contribution; it is not derived by this model and is not guaranteed. The base case assumes no further personal premiums, financing interest or bank-exit payments. Property taxes, home insurance, maintenance, closing and advisory costs and tax effects are excluded.

How each line is calculated
  • Traditional payment. Principal × r ÷ (1 − (1 + r)−360), where r is the annual rate divided by 12.
  • Program, years 1 to 15. Principal × r. Interest only; the balance stays at $3,200,000.
  • Program, years 16 to 30. The full $3,200,000 amortized over the remaining 180 months, which is why the payment is 67% higher than in the first fifteen years.
  • Projected policy cash. $370,000 a year on a $1,200,000 contribution in the reference case, scaled in proportion. It covers 113% of the later mortgage payment as illustrated.
  • Total you put in. Initial capital plus every mortgage payment not funded by projected policy cash.

Your cash position, year by year

Everything paid in, less projected policy cash received.

+$7.57M−$7.78MEvenYear 42
Family Office Mortgage, projected Traditional mortgage

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