Equity release mortgage advice needed

armcosurfer

Hi, I'm 55 and have my own home,it's a 5 bed end of terrace worth around £150,000 and I owe £93,000 on the mortgage. I'm paying interest only payments on this of £300 a month because of my finances, the mortgage will be up in 10 years and I won't have the money to pay it off. I would like to release the equity in the property , so If I took out an equity release mortgage ,how much would I be able to release? I understand I could then be living payment free in my property until I die,is this correct? Thanks.

dunstonh

how much would I be able to release?

The amount increases as you get older. At 55, you are too young for some providers but others will arrive at 60.

It would be worth trying to bring that £93k down a bit You can do a fair bit in 10 years. Otherwise you are going to be pushing it or relying on a house price increase.

? I understand I could then be living payment free in my property until I die,is this correct?

yes.

Thrugelmir

Can you afford to make any additional payments to your mortgage to increase the amount of equity available?

armcosurfer

No, I can't afford to make any additional payments at this time, I'm sort of semi retired and self employed, some weeks I earn ok money,others not much.
I'm looking to raise some capital to buy a few things I need( probably around £30,000?), but I'm also concerned that in ten years time I'll have to sell my house and rent a place to live in.
I went down the route of just making interest payments when I closed my business down 7 years ago, but I had always intended to move in the future when my house had increased in value. My circumstances have changed again and it looks like I'll be staying put.

Mojisola

armcosurfer wrote: »

Hi, I'm 55 and have my own home,it's a 5 bed end of terrace worth around £150,000 and I owe £93,000 on the mortgage.

I'm paying interest only payments on this of £300 a month because of my finances

Do you have spare rooms that could be let to lodgers or are they all used?

TrickyDicky101

armcosurfer wrote: »

No, I can't afford to make any additional payments at this time, I'm sort of semi retired and self employed, some weeks I earn ok money,others not much.
I'm looking to raise some capital to buy a few things I need( probably around £30,000?), but I'm also concerned that in ten years time I'll have to sell my house and rent a place to live in.
I went down the route of just making interest payments when I closed my business down 7 years ago, but I had always intended to move in the future when my house had increased in value. My circumstances have changed again and it looks like I'll be staying put.

If you can't afford to make any capital repayments before the term ends then you will obviously still owe £93k at maturity.

The equity in your house will be the difference between what it is worth in the future and this amount you owe.

If house prices don't increase in the next 10 years, you are highly unlikely to be able to release any equity as you simply won't have enough in the property to compensate for the lender's risk that your estate will ultimately fail to repay all outstanding monies (£93k capital plus rolled up interest) due when you die.

So you will be taking a big gamble that house prices will increase sufficiently to allow some form of release.

None of which helps you now if you need to release £30k for current expenditure plans.