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:confused: IS EQUITY RELEASE THE ONLY WAY TO GO?
Comments
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Is the loan in joint names with your mum and dad?
ONly I understood that if you dad has a loan and hes no longer with us the debt dies with him?
I don't believe this is correct.
The loan was secured on the house which (presumably) belonged half to the Dad.
The loan should have come out of this 50% share of the house before the wife inherited it.
Obviously that's difficult because she can't physically live in half a house or sell half a house.
The debt does not die with him because he had assets (half a house) and it needs to come out of that.
Equity release is possible but a better way to go would be for her to move to a smaller/cheaper home and release equity that way.
If she moves somewhere smaller/cheaper then the remaining money can pay off the loan and she will have no debt.
An equity release scheme is possible but of course there is a company making profits out of this so in the long run it will cost her a lot of money.
If she desperately wants to stay in the same house then it might be the only way to go but it will be expensive.
A good source of information is Age Concern.0 -
Morning all. This is my first post although I have been lurking for a little while; I hope I don't therefore breach any rules. I think I need to declare thart I am a Conveyancer and thus have some (although limited) knowledge about this - please note I do not regularly deal with Equity release mortgages but have dealt with 2 or 3. YOU MUST GET YOUR OWN LEGAL ADVICE! In general terms advice is only to take them out as a last resort. Once you have one you have really taken it on for life; get an illustration from one of the Lenders (Norwich Union and the Pru seem to be the main providers). If you really want to stay in that property for the rest of your life (there may be problems in transferring the mortgage) and you cannot afford to make any repayments, consider the following:
(1) it will substantially decrease any equity on death (or if you have to sell to move into residential care), you will not be given an option when to sell the property so if the market is poor, tough
(2) It can effect any pensions/benefits you may receive as you will have a captial sum and theoretically equity in the property you cannot release
(3) Unless your property significantly increases in value you will not be able to borrow any more secured funds. If you do borrow further monies it will have to be from the equity release provider (a restriction is entered on the register).
Having said that; if your father considers his expected life span v the monies he will receive it may be the answer for him. The thing to think about is that once it has been done there is no going back (unless you win the lottery or similar<g>) I would therefore only really suggest it for someone in, say, their 70s or 80s.
Hope this helps.0
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