Help for Mother-in-law equity release or loan?

WPT

Hello i'm new to this but after some advice. My mother in law is 72 and retired and has a home and garden that she loves. Sadly the home costs quite a bit to maintain and whilst she has enought money for bills she never has any spare to go on holiday, go out for dinner or treat herself.

She keeps tlaking about equity release but i'm not sure this is the best thing for her to do. In 3-5 years the garden will be too much for her anyway as she has bad arthritis and she has admitted that she will need and want to move then.

Any advice? One thought I had was a loan of about 15k over five years and she could then pay it back gradually and then pay it all off when she moves house. Just not sure what to advise, she is seeking advice from a financial adviser too but i just wondered if anyone had any ideas. thanks

Tixy

What income does she have?

I'd be surprised if anyone would lend her £15k over 5years at the age of 72.
Equity release schemes often work out very poorly for people, its hard to get a good deal for the equity holder.

Has she (or you on her behalf) been through all her costs to see if she can save money on her outgoings.
Older people often don't think to shop around to check she is getting a good deal on gas, elec, telephone, house insurance etc. Or to check if a water meter would be much cheaper as she lives alone. Maybe by looking into these type of things you could save her enough each month to allow her a few treats.

I'd guess if these all haven't been swapped for a few years you might easily make savings of £50per month. If you look at this http://www.moneysavingexpert.com/family/money-help it will give you an idea where to start.

WPT

she has a few pensions and bits and pieces but nothing substantial. we've already swapped lots of things over for her and saved her quite a bit per month but it's things like money to go away, to get the front of the house repainted, get a wood burning stove and money so she can go to the theatre.

[Deleted User]

why doesnt she sell this house with its oversized garden and by a nice little flat?and spend the profits?

27col

Woodbine is giving good advice.She should be getting out now, not in 5 years time when her health problems could become much worse. There comes a time when even the most entrenched of us oldies needs to bite the bullet and get realistic. The best help you could give her is to persuade her to downsize, whilst she is still able to do so. It is all very well loving the place that you are in, but not if staying there means a continuous source of worry about finance.

WPT

thanks - this is really what i think she should do - it makes a lot of sense. Wish us luck convincing her!

margaretclare

27col wrote: »

Woodbine is giving good advice.She should be getting out now, not in 5 years time when her health problems could become much worse. There comes a time when even the most entrenched of us oldies needs to bite the bullet and get realistic. The best help you could give her is to persuade her to downsize, whilst she is still able to do so. It is all very well loving the place that you are in, but not if staying there means a continuous source of worry about finance.

I couldn't agree more. Time after time I've seen older people hanging on to a house that is too big and difficult to manage - the stairs, the bathroom, the garden...Often people hang on, and on, until it becomes too late to move because the upheaval and the hassle are just too much in your 80s or later.

My first husband and I moved from a 3-storey Pennine cottage back in 1990. He'd been having strokes, needed to be able to walk on level ground, and it was all just too much. We moved to a 2-bed bungalow in Essex. Although he only survived 18 months to enjoy it, I remain convinced that it was the right thing to do. Even this little 1930s bungalow has needed a lot of modernisation, but we've just about done it all now, my second husband and me. Shower rather than bath, efficient heating system, doors/windows replaced, new kitchen, roof re-done. But at least we can live here in comfort and convenience even with increasing disability - hips and knees. It would break Mum's heart if she had to see her beloved garden go to rack and ruin - better get out now.