how to make best use of equity in mortgage when no dependants

Sassycat_2

Hello all. Had trouble deciding how to word the heading,but the situation is this.
I am 51 yrs old and have 14 years left on my mortgage ,which is currently a repayment. I should be able to retire in 9 years with a good pension and a lump sum payment,and I have no kids or partner so no-one I want to leave the house(or value of the house)to...I feel that I have had to work for this and would like to benefit from it.
The main reason for my post is this.....I work shifts and am finding them a major drain on my health so would like to either reduce my hours or change to a non shift job,but this would mean a major drop in my income. Is there anyway I can work with my mortgage to reduce my monthly outgoings that would still ensure I kept my home,bearing in mind I am not worried about who has it when I die (ie mortgage company). I know the obvious option would be to sell the house and rent,but I hate change and wouldnt want to keep moving every 6-12 months when agreement ran out,and long term tenancies dont seem readily available.
I hope this makes sense,and any suggestions would be greatfully received.

Thank you.

astreix

Have you considered an equity release mortgage? The way it works is that the lender will lend money against the property and the borrower does not repay anything during his/her lifetime. The accrued interest along with the principal is recovered from the sale of your house after death of the borrower and any excess remaining is passed on to the heirs.

This is an important decision and equity release is only one of the options. If you intend to pursue something like this it is best to seek independent financial advise.

The basic features of equity release mortgage can be foudn on norwich union website as they offer this product- http://www.norwichunion.com/equity-release/lifetime-mortgage.html. If you google you will find other lenders who offer this product.

Cannon_Fodder

Switching to Interest Only would be an immediate saving. Enough to help?

Is your pension lump sum enough to clear mortgage at end of term?

Maybe go for equity release when older. Still a surprisingly long time until the pension kicks in, a lot can happen. Inflation, redundancy...

If the term/uncertainty is the main obstacle to renting, I would recommend you search a little harder for long-term rentals in your area. 2+years deals can be found.

Whilst not very common, I am currently renting in a small row of houses where the only empty house is being refurbished after the death of the renter - who lived in the row her whole life...70+ years. Her daughter remains in the row, around 50...born in one, moved to her own...

Nice location, rural/village, as part of a wider "estate" (in the "landed" sense). Govt/Landowner/MOD type of estates may provide such very long terms.

Having 'Sold to Rent', there are times when one stops and wonders if the gradual erosion of the buying pot over the next 20 years is much different to buying again.

Obviously there is the rent-free retirement side to consider, 30 or 40 years of retirement, possibly - even with a nice pension you cannot be sure of what inflation will occur between now and then, or what Council Tax will be by then, but on the other hand you may get to 65 and need to go into a nursing home, with your house sold to pay for it...

tbh, I would err on the side of keeping some equity for the unexpected/long time still ahead. But you know your own health situation best. No point working yourself to the bone trying to create the perfect retirement situation, if you are too worn out to enjoy it...!

Good luck with the decision.

No charity you'd like to support, that could go in your will?

Sassycat_2

Thank you for the above replies.
Has given me some ideas to look into.

Sassycat x