mortgage advice-is this correct?

jessieja

Parents are looking into taking out a mortgage to raise funds to pay off mother's debts. Advisor is trying to steer them towards equity release; a roll-up mortgage, which obviously would be a last resort.

After pressing him, he has found a possible interest only deal with Halifax. Whole thing sounds very attractive, but I'm not sure about the fact he is delaying the application for 2 weeks when my mother will be 63 rather than currently 62, as he says the older they are, the better the deal they'll get. Am I just being mistrustful to think this doesn't ring true?

TrickyDicky

If they went for the interest only - how would they pay off the capital at the end of the term?

happyrichard

I would be steering away from interest only and frankly there must be some other way to pay off a debt by taking out another debt? No?

Conrad

I've never had to delay an application for age related reasons, so no I have no idea why he would do such.

I understand why you are looking at interest only - a lotof older people ask me for this as they are not particularly interested in repaying the capital, but just want the lowest possible outgoing. The only downside is a smaller inheritance for the beneficiaries.
Having said that, be careful to check the maximum term they are offered, as they may be forced to sell up at that point which is fine if thats why they intended doing anyway (for example to dow
nsize).

jessieja

they're looking to pay off the balance by downsizing when one of them dies/they need residential care/house becomes too much for them.

equity release schemes just leave me running for the hills- daylight robbery.

the deal would be fixed for 5 years initially

Gorgeous_George

As with everything, the interest rate and fees are vital. With equity release, the health and life expectancy are important.

Annuities are cheaper as you get older (less tme left for them to pay out). Maybe the Halifax deal is similar.

If it was my parents I'd offer my help.

GG

jessieja

If it was my parents I'd offer my help

Maybe Ive misconstrued your sentiments, but I find that comment extremely irritating.

Thanks for the constructive comments so far.