The Family Office Mortgage is a home-buying program that pairs a jumbo mortgage with a separately funded indexed universal life (IUL) insurance policy, part of whose premiums are financed by a bank. You commit about half the purchase price up front and pay interest only for fifteen years. From year 16, projected policy cash is designed to fund the mortgage payments.
The traditional 30-year mortgage was built for buyers who need to borrow as much of the price as they can. A household with capital has an advantage those buyers do not: it can commit more at closing and have that capital fund the home over time. You do not buy a home the way most people do. There is no reason to finance it the way they do.
Three contracts, planned together from the first day
The first contract is the mortgage. It is a jumbo loan, meaning a loan larger than Fannie Mae and Freddie Mac will buy. The Federal Housing Finance Agency set that limit at $832,750 for most of the country in 2026. In the program the mortgage runs 30 years: interest only for the first 15, then principal and interest for the remaining 15. It comes from your lender or one the team introduces. The program is a strategy and a coordinating service, not a lender.
The second contract is the life insurance policy. An IUL policy is permanent life insurance with a cash value. The carrier credits interest to that value using a formula linked to a market index, and it deducts the cost of insurance and other charges from the same value. In the reference case you make one contribution to the policy at closing, and a bank lends part of the premiums on top of yours. That bank loan is called premium financing, and it is the third contract.
The contracts are separate. Different companies issue them, and each carries its own obligations. What the program adds is the plan that connects them: the policy is sized at the start so that its projected cash can meet the mortgage payments later.
The name says who the structure is for. It is the home-buying structure a family office would use, opened to households that qualify. The program is not a family office, and you do not need one to use it.
Three debts sit inside the plan, and they stay separate
| Debt | What it finances | The plan in the reference case |
|---|---|---|
| The mortgage | The home | $3,200,000 borrowed at purchase. Interest only for 15 years, then principal and interest. Repaid at the end of year 30. |
| The premium-finance loan | Part of the insurance premiums | A bank loan with its own interest and collateral terms. It has a planned exit around year 15. |
| Policy loans | Cash taken from the policy | Borrowing against the policy’s own value. It can continue after the bank is repaid. |
The three stay on separate lines because each has its own lender, its own schedule and its own planned end. The bank’s premium-finance loan has a planned exit around year 15. The mortgage is repaid at the end of year 30. Policy loans are borrowing against the policy’s own value. They accrue interest and are settled from the death benefit.
Repaying one does not retire the others, so ask to see all three balances, year by year. After closing, policy values, the bank loan and the collateral are reviewed every year against the plan.
The reference case shows the plan in numbers
The example used across this site is a $4M home with 20% down. Both columns use the same assumed mortgage rate of 6.1%, which is an assumption and not a rate offer. The baseline is a traditional 30-year mortgage with no investing on the side.
| Measure | Traditional | Program |
|---|---|---|
| Home / down / mortgage | $4,000,000 / $800,000 / $3,200,000 | same |
| Policy contribution | none | $1,200,000 |
| Initial capital | $800,000 | $2,000,000 |
| Monthly, years 1–15 | $19,391.83 | $16,266.67 (interest only) |
| Scheduled monthly, years 16–30 | $19,391.83 | $27,176.61 |
| Designed source of that payment | your income | projected policy cash |
| Projected policy cash | none | $370,000 a year, years 16–62 |
| Total personal contributions | $7,781,059.93 | $4,928,000.00 |
The mortgage figures are calculated. The $370,000 a year is the illustrated input for the reference case. Your own comparison calls for a carrier illustration for the person who would actually be insured. Property taxes, home insurance, maintenance, closing costs, advisory fees and tax effects are left out of both columns.
Half the purchase price is committed up front: 20% as the down payment and 30% to the policy. That half is capital you commit. The price of the home does not change. What changes is what your capital does. In the reference case, $1,200,000 of it is in the policy from the first day, where a traditional mortgage leaves thirty years of payments to future income.
The plan runs in five stages
At purchase. You pay $800,000 down and contribute $1,200,000 to the policy. The lender funds the $3,200,000 mortgage. The carrier issues the policy, and the bank’s premium financing and collateral arrangements are put in place.
Years 1 to 15. You pay $16,266.67 a month from your own income. That is 16.12% lower than the traditional payment because it is interest only. The mortgage balance stays at $3,200,000 through this period, by design. Principal is scheduled for years 16 to 30, when projected policy cash is designed to fund the payment.
The reference case is built on you paying no further premiums and no financing interest from your own pocket in these years. The bank’s premium-finance loan has a planned exit around year 15. Throughout, policy values, the bank loan and the collateral are reviewed every year against the plan, so adjustments are made early.
Year 16. Two things change. The mortgage begins to amortize, so the scheduled payment becomes $27,176.61 a month, or $326,119.29 a year. And projected policy cash of $370,000 a year begins, taken through policy loans or withdrawals and directed to the mortgage. If the policy performs as illustrated, it funds the payment and leaves $43,880.71 a year.
Year 30. The mortgage is repaid. It has run its full 30 years.
Years 31 to 62. Projected policy cash of $370,000 a year continues through year 62, the last year shown. Under its stated assumptions, the reference case shows a conditional nominal cash surplus of $7.57M through year 62. A remaining death benefit of about $2.6M is shown on its own line, separate from cash already received.
Projected policy cash is paid during the insured person’s lifetime. When the insured dies, the policy pays a death claim to the beneficiary instead, net of any loans.
Every transaction is underwritten before it is proposed
A structure with a mortgage, a policy and a bank loan has known risks. Index credits vary from year to year. The bank’s loan has its own rate and collateral terms. The mortgage payment follows its schedule whatever the index does. An experienced team identifies each of these up front and builds the plan around them. That is what the team is for.
- The team’s underwriting. Every transaction is underwritten by the team before it is proposed. This is the team’s own review of the whole plan. It is separate from the lender’s decision on the mortgage and the carrier’s decision on the policy.
- Conservative modeling. Each case is modeled under a conservative risk profile and run through simulations across many market paths before it is proposed.
- Three outside decisions. The lender qualifies you for the mortgage in the usual way, the carrier underwrites the insured person medically, and the bank approves the premium financing. The insured may be you, a spouse or an adult child.
- Your own advisors. Your CPA and attorney review the proposal before anything is signed. The advisor brief is written for them.
- A planned exit. The bank’s premium-finance loan has a planned exit around year 15.
- Review every year. After closing, policy values, the bank loan and the collateral are reviewed every year against the plan, so adjustments are made early.
The team has done hundreds of transactions. That experience is the reason to work with it, and it is why the plan you are shown has been tested before you see it.
The plan is built with margin
A carrier illustration, as the National Association of Insurance Commissioners describes it, shows how a policy is expected to perform under the specific assumptions set out in it. Some of its values are contractual minimums. Others rest on current assumptions. Index-linked credits arrive unevenly from year to year, so the plan is not sized to the illustration with nothing to spare.
Margin is the first part of the management. The second is the annual review. Policy values, the bank loan and the collateral are checked against the plan every year, so adjustments are made early. How the risks are managed covers the team’s part in more depth.
Tax treatment depends on the case. The IRS says life insurance proceeds paid because of the insured’s death are generally not taxable to the beneficiary. Loans, withdrawals and surrenders each have their own rules. Bring your CPA. The advisor brief is written for them.
It is built for a specific group of households
The program is built for households with $5M or more in assets apart from the home, household income of $500,000 or more, and the capital to commit half the purchase price without strain. It is designed for a horizon of fifteen years or longer and an insurable person in the family. The eligibility page lists each criterion.
Those criteria are where the underwriting starts. They describe the households whose capital, horizon and insurability let the structure do its work.
It differs from a traditional jumbo and from paying cash
| On a $4M home | Pay cash | Traditional jumbo | Program |
|---|---|---|---|
| Capital at closing | $4,000,000 | $800,000 | $2,000,000 |
| Monthly, years 1–15 | none | $19,391.83 | $16,266.67 |
| Scheduled monthly, years 16–30 | none | $19,391.83 | $27,176.61 |
| Designed source of years 16–30 | not applicable | your income | projected policy cash |
| Projected policy cash after year 30 | none | none | $370,000 a year through year 62 |
| Life insurance in the plan | no | no | yes |
Paying cash is the simplest. It puts $4,000,000 into one asset and asks for nothing after that. A traditional jumbo leaves $3,200,000 in your hands and asks for thirty years of payments from income: $7,781,059.93 in personal contributions in the reference case. The program sits between them on capital, with $2,000,000 at closing and personal contributions of $4,928,000. It is designed to add what neither of the others has: a planned source for the later payments, projected policy cash after year 30 and a death benefit.
The comparison page sets the traditional and program columns side by side, year by year. For the cash decision, see paying cash or financing a luxury home.
Where The Family Office Mortgage fits
It fits a household that could pay cash or carry a traditional jumbo, expects to keep the home for decades, and wants the payments of years 16 to 30 planned at the start, not left to future earnings.
A traditional mortgage asks the same thing of every borrower: a small share of the price now and thirty years of income afterward. A household that qualifies for this program can do something most borrowers cannot. In the reference case it commits $2,000,000 at closing, $800,000 down and $1,200,000 to the policy, and that capital is designed to fund the home over time. Capital is the advantage. This is the structure that uses it.
The structure has known risks, and that is the reason the team matters. Every transaction is underwritten before it is proposed, modeled under a conservative risk profile, built with margin and reviewed every year after closing. It is managed to protect the plan and the household behind it. The team has done hundreds of transactions. Your own CPA and attorney review the proposal before anything is signed.
The useful next step is a comparison built on your own price. The calculator runs the same arithmetic on your numbers and labels the results as illustrations. See if you qualify: your details go to one person, Kent Chesley. How the program works goes through the mechanics in more depth.
