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    • AL1973
    • By AL1973 4th Oct 17, 8:56 AM
    • 3Posts
    • 0Thanks
    AL1973
    Borrowing money against house
    • #1
    • 4th Oct 17, 8:56 AM
    Borrowing money against house 4th Oct 17 at 8:56 AM
    I would like to borrow money against my house but unsure what is the bet way to do this.

    My parents gifted me money to buy my house, and together with my savings, I bought without a mortgage. Now my situation has changed, and I would like to raise money (40,000-60000) to give to them.

    What would be the best way to do this? Taking out a mortgage? A guaranteed loan? (I'm 45)
Page 1
    • zx81
    • By zx81 4th Oct 17, 8:58 AM
    • 14,400 Posts
    • 15,196 Thanks
    zx81
    • #2
    • 4th Oct 17, 8:58 AM
    • #2
    • 4th Oct 17, 8:58 AM
    Your repayment period would be key to making that decision - as well, of course, as your credit history.
    • dogshome
    • By dogshome 4th Oct 17, 9:32 AM
    • 2,941 Posts
    • 1,498 Thanks
    dogshome
    • #3
    • 4th Oct 17, 9:32 AM
    • #3
    • 4th Oct 17, 9:32 AM
    I guess from your post it's your parents situation that has changed - Bully for you in wanting to help out.

    Before you do anything look at all the options of their situation - If they have hit really hard times, dropping a large amout of cash in their laps could do more harm than good as it will deny them many state benifits they could otherwise claim
    • AL1973
    • By AL1973 4th Oct 17, 9:49 AM
    • 3 Posts
    • 0 Thanks
    AL1973
    • #4
    • 4th Oct 17, 9:49 AM
    • #4
    • 4th Oct 17, 9:49 AM
    Thanks you both for your advice

    zx81 - my credit history is good, and I would prefer a longer paying off period
    • zx81
    • By zx81 4th Oct 17, 9:50 AM
    • 14,400 Posts
    • 15,196 Thanks
    zx81
    • #5
    • 4th Oct 17, 9:50 AM
    • #5
    • 4th Oct 17, 9:50 AM
    Then it looks as if a mortgage may be the better option.

    However, 40k is around the minimum level for a mortgage, so you may need to do some checking around before choosing a lender.
    • Clive Woody
    • By Clive Woody 4th Oct 17, 12:30 PM
    • 4,403 Posts
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    Clive Woody
    • #6
    • 4th Oct 17, 12:30 PM
    • #6
    • 4th Oct 17, 12:30 PM
    DO your parents need the full amount immediately or is this needed over a number of years?

    The reason I ask is that it might be better to go for an unsecured loan which you can start paying off and maybe look at additional borrowing later on. The advice is normally to avoid secured borrowing where possible.
    Rugby Union - The Greatest Game
    • ricky_v
    • By ricky_v 5th Oct 17, 9:43 PM
    • 265 Posts
    • 131 Thanks
    ricky_v
    • #7
    • 5th Oct 17, 9:43 PM
    • #7
    • 5th Oct 17, 9:43 PM
    The reason I ask is that it might be better to go for an unsecured loan which you can start paying off and maybe look at additional borrowing later on. The advice is normally to avoid secured borrowing where possible.
    If the OP is sure that they can more than afford the repayments then a mortgage would be better for the lower interest rate. If the OP is living beyond their means wanting to consolidate a load of unsecured debt into a mortgage then that is certainly a bad idea.

    A £60,000 loan assuming the property is worth more and £100,000 is from 1.49% fixed for 2 years to 2.49% fixed for 10 years. Taking unsecured loans now and into the future will certainly cost more, but ofcourse the Op's house is at risk if the s*** hits the fan in terms of his/her finances.
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