Equity release?

jammymutt

Firstly im not sure where to post this but I really need some help.

My in laws have a house worth about £550,000 they invested heavily throughout their working lives in many pension and insurance investments , they have had their home on the market for about a year now and had no luck at all but now they need to raise some capital to be a little more comfortable.

I havent ever read anything good about Equity release but my father in law has asked me to try and seek a good one if possible.

Thats where I need the help is it worth them dropping the price of the house by £say £100,000 or borrowing that as an Equity release?.

They have little bits of invesment here and there but not a lot to live on they were advised by a rogue who told them to invest a lot of the money they had when they retired which has not lmade anything and if anthing it has made a big loss for them.

Please help I am also thinking of trying to get an Independant Financial Adviser to talk to them but how do you know you have a good honest IFA?.

I Dont suppose anyone wants to buy a very nice houes in Notts?.

geoffky

Equity release is a mugs game...the house will sell for what it is worth...It may be overpriced

getmore4less

why were they trying to sell, if thehouse is too big to expensive to maintain then they should still move,, overpriced if not selling.

How long would 100k last, then what?

A review of their pensions and current investments is a higher priority if they are wrong.

Annisele

I think that equity release is an option of last resort. That doesn't mean that it's always unsuitable - only that all other options should be considered first.

I'd agree with getmore4less - if the house isn't selling, it may well be overpriced. How much are similar houses actually selling for? The amount they're on the market for isn't really the point; it's the actual selling prices that matter.

If the house is overpriced, then yes, it's definitely worth dropping the asking price. If it's not overpriced, then possibly there's something awry with the advertising, or the presentation, or or or - but 99 times out of 100 it is the price.

With regards to the investments, if they were suitable but your in-laws are disappointed with performance, well, c'est la vie. If the investments were riskier than your in-laws were willing to accept, they may have a valid complaint about whoever advised them to take the investments out.

jammymutt

Thank you for the replies I have suggested they drop the price a b it whats the best thing to do about what they have ionvested at the minute? IFA? if so how do I know im getting a good one.

Thanks for the replies.

Wh05apk

What is there overall position income wise? do they need additional income to live on or is it simply for capital purchases such as cars/holidays/repairs?

If they were to sell and downsize what would be the costs in terms of fees/stampduty solictors etc?

There is nothing wrong with equity release, for the right person, however as Annisele said, it should be viewed as a last resort, but they could raise a mortgage to either provide a monthly income, or a lump sum now with a drawdown facility to meet needs later.

jammymutt

They need an income to live on at the minute its a big house to keep going on a small stae pension and an even smaller private pension I dont think they need any extravagences.

Wh05apk

So possibly if they dont want to downsize, an equity release mortgage which provides a monthly income with a facility for some lump sum drawdown in case of need could suffice, I would suggest finding a good equity release qualified broker to discuss what is available.

sleepless_saver

A good source of information about the different sorts of equity release and the pros and cons is the Equity Release Council http://www.equityreleasecouncil.com

In their shoes I would reduce the selling price. Sadly their house is definitely not worth £550k - it's worth what someone is prepared to pay for it so the price is too high. If they sell and downsize they would still have the option of equity release on any new property they bought if the capital released from the sale was not enough.

sleepless_saver

jammymutt wrote: »

Please help I am also thinking of trying to get an Independant Financial Adviser to talk to them but how do you know you have a good honest IFA?.

https://www.unbiased.co.uk and recommendations from friends/family.