SOA - Advice needed please

AndyLGR

I'm putting together my father in laws SOA. Unfortunately his partner passed away leaving a huge hole in the householed income. Therefore hes looking to restructure the mortgage to bring the monthly amount down.

Income:

Total Pension Income 650

Outgoings:

Mortgage 350
Gas & Elec 105
Water 33
Home Insurance 10
Plumbing insurance 5
Life Insurance 10
Car insurance and car tax 37
Petrol 60
Food 150
TV / Broadband / Phone line rental 33
Mobile Phone 10
Clothes 10
MOT / Car repairs 20
Membership Hobbies 5
Credit Card 20

Total Outgoings 858

Initially his mortgage lender has proposed a drop in montlhy payment to approx 140, but this virtually wipes out all his monthly income with no room for maneouvre.

In an ideal world he'd love to be able to pay as little as possible until he dies and it then passes over to his children. But I'm wondering if its ok to allocate a monthly amount towards birthdays or xmas? If so does anyone know what an acceptable allowance would be?

Is there anything obvious I've missed? He is paying no council tax as he gets pension credits btw.

rockm87

Have you checked any other benefits he is entitles to?

food could probably be bought down, with smarter shopping, switching supermarkets or using local market for fruit and veg.

AndyLGR

All benefits have been covered.

I think hes trying go the other way and get the lender to accept a lower amount than what they have initially offered. But at the moment its left to me to negotiate it as hes too stressed out with whats happened.

Pixie5740

I think there are one or two things missing from the SOA like a television licence (assuming he watches television as it's being broadcast). Try filling out this SOA which most MSE folk use, it's pretty comprehensive.

http://www.stoozing.com/calculator/soa.php

As well as using the benefit checker is there anything else he can do to boost his income? A part time job or a lodger maybe?

theoretica

Why is he paying life assurance and is it worth it for him? If he wants to cut payments now that might be one target, assuming his children are not dependent on him.

January2015

When my dad died my mum was in a similar situation. She considered equity release, but thankfully decided it wasn't right for her. She ended up renting a room out (taking in a lodger). She now has company Monday to Thursday evenings (the lodger goes home up North Friday evening and arrives back at her house after work on Monday).

The amount the lodger pays covers her mortgage payment and leaves her pension income free for her to live on and have some niceties in life.

enthusiasticsaver

Paying a mortgage on a pension is difficult. Is there enough equity for him to sell and downsize? If he no longer works is there a need for him to have a car and would he get subsidised bus travel as a pensioner?

AndyLGR

enthusiasticsaver wrote: »

Paying a mortgage on a pension is difficult. Is there enough equity for him to sell and downsize? If he no longer works is there a need for him to have a car and would he get subsidised bus travel as a pensioner?

Yes theres equity there, but he wants to try and stay in the house. Memories and all that. Maybe he’ll think differently in time. He’s dependant on his car to get around, but again that will probably change in time as he gets a little older.

theoretica wrote: »

Why is he paying life assurance and is it worth it for him? If he wants to cut payments now that might be one target, assuming his children are not dependent on him.

The life assurance would basically cover the cost of a funeral and a bit extra so yes that’s an option to cut down as the kids are grown up and left home now.

asparagus1968

Hi, am presuming his partner didn't have any policies ? how old is he? Does he get winter fuel payment? free tv licence?


his gas/elec are high (ours is 70/month, 2 people,2 bed house, and we don't scrimp) same with water. maybe check tariffs and usage, make sure he isn't in credit (and the companies have his money sitting there)
food budget could be cut, depending on his cooking skills.


How much mortgage does he owe in total?
rent a room/ driveway/garage could increase income.
Part time job?


It's a shame he is struggling with money as he wants to leave an inheritance, but a lot of the older generation feel that way.

iris

Has he applied for Support for Mortgage Interest (SMI)?


Check the following link


https://www.gov.uk/support-for-mortgage-interest/eligibility

AndyLGR

asparagus1968 wrote: »

Hi, am presuming his partner didn't have any policies ? how old is he? Does he get winter fuel payment? free tv licence?

asparagus1968 wrote: »

his gas/elec are high (ours is 70/month, 2 people,2 bed house, and we don't scrimp) same with water. maybe check tariffs and usage, make sure he isn't in credit (and the companies have his money sitting there)

How much mortgage does he owe in total?
rent a room/ driveway/garage could increase income.
Part time job?

It's a shame he is struggling with money as he wants to leave an inheritance, but a lot of the older generation feel that way.

Unfortunately she had no policies and as they weren’t married nothing has gone to him other than the house switching over to sole name.

This has certainly been a lesson in the things you should try and do to cater for those that are left behind

I agree on the gas/elec I pay less than that with kids in my house, so that’s something I need to look at for him. Equally the other utilities too.

Hes 64 and owes around £13k on the mortgage.

You’re right he wants to leave his kids something - the house.

iris wrote: »

Has he applied for Support for Mortgage Interest (SMI)

Thanks, he’s applied for this and is getting a bit a month towards it.