Equity release

Conrad

margaretclare wrote: »

No one would dare to speak to me in those terms even now, and I'm a little bit older than 60s! They'd get very short shrift if they ever tried to!

I would, no one on this Earth scares me, least of all those that have to tell you how tough they are - you know East end types.

margaretclare

Conrad wrote: »

I would, no one on this Earth scares me, least of all those that have to tell you how tough they are - you know East end types.

Not an East End type - a long long way from the East End is where I originated. I'm not scared of anyone either. Since Liz, my daughter, died, there's nothing that either scares or worries me, because nothing is really worth it.

HelenDaveKids

I have a bit of a tricky question that i would really appreciate some advice. My parents are in there late 60's and are tempted to equity release as feel they are no longer getting the life style they want (holidays etc). I'm concerned that they will get fleeced however have absolutely no concerns in them spending every penny they have, in terms of inheritence. They initially asked if we (husband and I) would buy their property but then seem reluctant with the idea to rent (even from us). We have primary school children, have worked hard to pay off and are now free and have a growing savings account which we had intended to use to buy a bigger property at a later date). To buy their property it would cost about 140k, over 20 years would be approx £850 a month yet income wise would only be expecting about £450 rent, which would be a large financial drain at what is a costly point in our lives. another option would be to loan them lumps of cash (at a reasonable and fair rate) the downside being it would need to be legally binding as I have several siblings and also don't particularily want the government to have my cash if they ever needed nursing home care plus this would prevent us from getting our dream property. Any suggestions????

margaretclare

HelenDaveKids wrote: »

I have a bit of a tricky question that i would really appreciate some advice. My parents are in there late 60's and are tempted to equity release as feel they are no longer getting the life style they want (holidays etc). I'm concerned that they will get fleeced however have absolutely no concerns in them spending every penny they have, in terms of inheritence. They initially asked if we (husband and I) would buy their property but then seem reluctant with the idea to rent (even from us). We have primary school children, have worked hard to pay off and are now free and have a growing savings account which we had intended to use to buy a bigger property at a later date). To buy their property it would cost about 140k, over 20 years would be approx £850 a month yet income wise would only be expecting about £450 rent, which would be a large financial drain at what is a costly point in our lives. another option would be to loan them lumps of cash (at a reasonable and fair rate) the downside being it would need to be legally binding as I have several siblings and also don't particularily want the government to have my cash if they ever needed nursing home care plus this would prevent us from getting our dream property. Any suggestions????

Your parents should start either by looking at the SHIP website: http://www.ship-ltd.org/ OR they should find an independent financial adviser who has some experience and expertise in this particular field.

They should find out as much as they can about all the implications. Post #1 in this thread is a cautionary tale - the people did not understand what they were doing and now regret the action they took. It's not so difficult to understand as all that, but it does need a little time and some thought and discussion.

I personally would not take this action just for 'holidays', but you complicate the discussion later by talking about 'the government getting MY cash (My? Don't you mean your parents'?) and mentioning your 'dream property'.

It does need serious thought, though. When we did it, our conveyancing solicitor had a list of items to go through with us. There can be implications for means-tested benefits, for instance. All this has to be thought about.

HelenDaveKids

Sorry If confused. What I mean is if we did buy their property outright, that I would need it sewing up properly legally because if not theoretically it could be used at a later date to pay nursing home fees etc, and thats not a risk we could take because thats the money we would have as our personal nest egg. Have thought perhaps buying the house and them paying rent but again i don't think it's the perfect answer as in effect that could be problematic, as essentially our "investment" would be their home.

We've been creating a nest egg and waiting for the right house to come up for sale which in effect would then have to wait.

whatever the solution, its completely their money and all i want is for them not to get stung and for them to both enjoy spending it if thats what they want. The company they looked at essentially lent them 50k but in 15yrs this would be 112k.