should we save the house or not???

sportytaxi

Hi all try keep it simple,just found out my parents have done equity release..
they borrowed £70,000 (index link cash release plan),now its over £100,000 6yrs on with a penity for paying off which is linked to the GILT YIELDS if the gilt goes down you have to pay more( i have no idea what the GILT YIELDS is but look pain full if it goes down) property worth £350,000 was all paid off,ages 67mum not fantasic health but ok,father 77 good health.

me owe £114,00 on repayment 20 yrs left but over paying £3000 a year to reduce time to about 13 years,fixed at 5.28 10yrs 8 left 6% redemption fee. good with money(well try to be!!!)

they wont downsize both have private pensions + state pension,father works part time,they didnot need to do this im gutted,the FA has now not been in contact as they told him they would like to sort this out because family not happy..

the only thing i can think of is to us to raise £80,000 on top of my £114,000 i know redemption is 6%,and go on intrest only am i mad or shall i let norwich union eat our inherrentance???

my payments are £775 on repayment at mo but overpay £3000 because i wanna be mortage free..

thanks for reading this i know alot of mortage exsperts read here and would welcome some advise....

thanks everyone....

ps they done the release becase of inherrentance tax thats all they can remember,that they was advise to do was it the thing to do in 2002?? sorry about spelling.........

sreppaw

What did they do with the 70k? Did they give it to their beneficiaries?

Gorgeous_George

Might still prove to be a good move (if house prices continue to slide). It's their money and they can do with it whatever they wish.

Hopefully they will enjoy a few cruises and blow the lot before they die. When they took the money they did not know that house prices would rocket and £70K for them to spend rather than leaving it for the cats' home (or whatever) may have seemed sensible back then.

It costs to borrow money and they have had £70K for 6 years, interest free. If they live until your dad is 100, they might start to make a profit. Lots of people live to be 100 these days.

Are you upset to have lost your inheritance or concerned for your parents?

GG