Mortgages

From Facebook to your Mortgage: What happens when you die?

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You’ve possibly already thought about some of the more obvious things like your house, your car and your family. But what about your bank accounts? Or even your Facebook profile? Wrapping up your whole life is not a simple task as Alex explains.

 

 

What happens to my mortgage and bank accounts when I die?

 

When you pass away the bank requires you (as the other party of the contract) to pay back lending in full before any property or money is distributed to beneficiaries.

 

All bank accounts and overdrafts are immediately stopped. Payments to the bank for interest and fees will still continue from the same account to avoid defaults. Then your estate needs to service the loans in the interim from those accounts. When you co-owned the property, the ownership can be transferred solely to the surviving owner.

 

Business accounts are a bit more tricky and these will freeze instantly as the owner of them is no longer there. If there is a partnership they will be frozen well as the partnership ended upon the passing of the other partner.

 

It is very wise to update your lawyer 

 

What about my Facebook account?

 

When you die, nothing automatically changes to your Facebook – but as soon as Facebook knows that you are no longer with us (and boy, do they know) there are a few options that you can choose:

 

1. Leave it as it is

You can, of course, leave the account as it is. This is not recommended as it means your data is guaranteed to be 100% secure.

 

2. Memorialise your account

Your loved ones can ask for your Facebook account to be memorialised by completing a memorialisation request and providing a scanned copy of the death certificate. Once the account is memorialised, no content can be altered or removed and the account is effectively locked down to eliminate any chance of being hacked. Only legacy contacts (your ‘digital executors’ can post on your behalf (for example, to give friends and family details of a memorial service). Friends and family can still post on your timeline to share memories.

 

3. Delete all data

Facebook only allows immediate family members to request all your data be deleted. They process this as a special request, and it requires scanned documentation as proof of your death. You can download all your Facebook data at any time if you wish to keep back ups.

 

Of course, that’s not even the half of it!

 

Come and have a chat to us or make an appointment with your lawyer to talk about it more. We’ll help you take charge by working out what might be the best option for you – and getting it down in writing.

 

Alex Barendregt is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A Disclosure Statement is available free of charge upon request

Have you been to a Velocity property seminar?

 

Are you buying or know someone that is buying?

Our First-Home Buyers Seminars in Wellington Central, Wainuiomata, and Johnsonville (and anywhere else that will have us) are perfect for getting your head around the process. The sessions include great tips on how to work with lawyers, builders, mortgage brokers and real estate agents.

 

Are you thinking of selling in the next six months?

Again, we have seminars in Wellington Central and Johnsonville. Our team of knowledgeable experts will give you tips on methods of sale as well as how to manage that dreaded bridging finance. 

Seminars are free-of-charge and are a perfect date night (well, to be honest, you might like to tag on a rom-com after the seminar to keep the other half happy).

 

Check our link here for venues and times. Essentially, all the time, everywhere!

 

 

 

Setting up my kids for the future

If we find it challenging to buy a home, imagine what it might be like for our kids. Brendon shares what he’s doing to improve his kids’ home-ownership chances.

 

I have been responsible for bringing two boys into the world and I think my responsibilities don’t end there.

On a philosophical level, two of the key things I believe I need to do as a dad are to, firstly, do all I can to get them through to adulthood with a positive sense of self-regard. And, secondly, I need them to know that I think they are both awesome. The two ideas are, of course, related, but if I have done them then I think I have done okay. Stay tuned for progress reports.

Beyond the philosophical, there are some things on a financial level I want to do in order to set them up. 

I would really like them to be in a position to buy a house in the future (if they actually want to do that is up to them, of course). So the first thing I will do is to encourage them not to live in Auckland!

That aside, they have both been signed up for KiwiSaver. When I set this up they were eligible for the $1000 government kick-start (not available now) so I took that opportunity.

The second, and related, issue is around setting them up with some skills and habits towards working. 

My eldest, who is now 16, works five hours a week with me at Velocity Financial (I often wonder why all my scanned files show up upside down!). This is a little easier for me to organise than for some because I am also the employer. However, I still think this was one of my better moves as a dad. We gave him a formal interview and set him up on our payroll system officially. He has a job description and is accountable for his performance. He is living the dream!

He also contributes to his KiwiSaver. This is part of the home ownership plan.  We are using that to help him save for a deposit.

My youngest is 12 and he has just started a paper run. He is a contractor (hence, why they can get away with paying less than minimum wage and is paid on “weight” of delivery—just in case anyone is interested). The reason this is relevant, however, is that, because he is a contractor, his “employer” doesn’t pay KiwiSaver. So we have set up voluntary payments to his KiwiSaver.

To be fair, $2 per week isn’t going to get him into a house for quite some time. However, at this stage we are concerned about setting up the habits that will get him there.

All our great laid plans aside, it may be that when our boys are ready to buy a house they may still need our (my very patient wife and my) help. So we are working on a debt reduction strategy so we are in a position to do that. Investment property has also been part of our strategy to help get us there.

Let me finish with a quick sales pitch. Yes, at Velocity we can set your kids up for KiwiSaver and can talk debt reduction and financing investment properties. We can also point you in the direction of good lawyers we work with to make sure your affairs are structured in such a way where your kids will be looked after and a way that aligns with the plans you have for them.

Do feel free to get in touch!

Brendon Ojala is a Registered Financial Adviser with Velocity Financial. No investment decision should be taken based on the information in this blog alone. A disclosure statement is available free of charge upon request.