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A comment on Tontines may make sense despite their history of disrepute. Parent comment

Re:Tontines may make sense despite their history of disrepute by Someone on Wednesday June 08, 2016 @04:42PM (#11865489)
It is a lottery with two participants that willingly took part in it. She won big, but if she had died the day after the contract was signed, he would have won big: he would have gotten the house for about $500. Would you suggest he should have paid her inheritance a lump sum if that would have happened?
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Re:Tontines may make sense despite their history of disrepute by joshvm on Thursday June 09, 2016 @02:18PM (#11871251)
He would have had to make a down-payment on the house too. You pay e.g. half the total payment up front and then the remainder in monthly installments. Still, it would have been a quarter of the retail price, not half, in that case.
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Re:Tontines may make sense despite their history of disrepute by coldtea on Thursday June 09, 2016 @10:03AM (#11869412)
I don't see much harm in "winning big" over somebody who just died. Being dead, it's not like she would have missed the money.

On the other hand, having someone pay tons of money and then die without anything to show for it, I do see, even if he "willingly signed into it".

There's also a threshold over which it should just be handed over. That such a threshold wasn't in the contract doesn't make it any less odious.

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Re:Tontines may make sense despite their history of disrepute by Someone on Thursday June 09, 2016 @02:28PM (#11871318)
Her heirs would have disagreed. Consider the case where your mother owns a house and 'sells' it for $500 just before dying.

Also, I expect people buying such rights are generally well-off, and the people selling it to be relatively poor. After all, the buyer must be able to pay money on a house they cannot live in for an indeterminate period, and the seller typically chooses this construct to be ensured of both a roof over their head and money to live from for one's entire life, no matter how long that is.

The odds in this lottery get better every month for the buyer, so, assuming that the buyer can afford to buy into this, they should have no reason to want to get out of this.

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