Lifetime Mortgage

Onlooker

Quote from a leading financial page today"With the political landscape and economy volatile,many are adopting a wait-and-see approach "This is advice to take into account before committing to a long term involvement like Equity Release and Lifetime Mortgages.The industry has already taken measures to cover their interests,in particular if a period of house price recession takes place.They are all better informed in advance than the public Wait is your best option.Consider

Onlooker

Every financial page is at this time non- commital as to the financial future of house inflation.Taking a Lifetime Mortgage is dependant on annual growth over the whole term of that mortgage.If prices stagnate or fall even below 2% per annum it will costly to anyone borrowing this way.Ask for estimate over 20 years at 2% inflation on a £200000 property.Request the charges on say a £50000 release at 5%. over the same period and make your decision before on the result.Other options are available.Consider

the.weekender

I am thinking of looking into a drawdown lifetime mortgage, I am 72, with a house paid off and worth around £320K, asset rich, cash poor.
We have no children or other family members, my wife is younger than me and is thinking/going to leave the house etc to charity when we are both gone.
No chance of downsizing, we like it here too much and have put too much into our house of 27 years.
We would like about £10K a year to spend on cruising whilst we are both fit enough to enjoy it.
I am not in any great rush and will look into what changes came into the Equity Release market last September, as I believe institutions such as Nationwide are now involved.

Farmer_Johnson

The first bit of advice I’d give you is to ignore Onlooker who keeps posting here. He or his family seem to have takes out a loan without trying to understand what an interest rate means first and is now railing against the world for his foolishness.

Next, look very carefully into your options, and take some proper advice about whether it is suitable for your needs.

Linton

the.weekender wrote: »

I am thinking of looking into a drawdown lifetime mortgage, I am 72, with a house paid off and worth around £320K, asset rich, cash poor.
We have no children or other family members, my wife is younger than me and is thinking/going to leave the house etc to charity when we are both gone.
No chance of downsizing, we like it here too much and have put too much into our house of 27 years.
We would like about £10K a year to spend on cruising whilst we are both fit enough to enjoy it.
I am not in any great rush and will look into what changes came into the Equity Release market last September, as I believe institutions such as Nationwide are now involved.

I recommend you talk to specialist mortgage broker. The amount of money you can get will be highly dependent on wife’s age as you say she is younger than you. You could look at the calculator at https://www.aviva.co.uk/retirement/already-retired/equity-release/ to get some idea of how much money you could borrow.

the.weekender

Thanks FJ and Linton, There is no rush for a lifetime mortgage, I have had it at the back of my mind for a year or two but there is no need for funds at the moment. Obviously the older we get the better the deal.
I will definitely consult a specialist mortgage broker to see what our options are, but as things stand a drawdown lifetime mortgage would appear the best option to suit our requirements. Happy New Year All.

Farmer_Johnson

the.weekender wrote: »

Thanks FJ and Linton, There is no rush for a lifetime mortgage, I have had it at the back of my mind for a year or two but there is no need for funds at the moment. Obviously the older we get the better the deal.
I will definitely consult a specialist mortgage broker to see what our options are, but as things stand a drawdown lifetime mortgage would appear the best option to suit our requirements. Happy New Year All.

They can be an excellent solution for someone who’s asset rich, and wants to enjoy the money they locked away, but do look very carefully at how it will leave you down the line.

I think that some people can take them out imagining they get a nice chunk of money without there being a real payback due later in the form of giving up ownership of the property or having a large debt owed from the estate.

They shouldn’t, but as Onlooker above shows, there really are some who imagine you can get for example £60,000 in your hand now and pay back about the same some unknown number of decades in the future.

I’d love to know what he blew the money on.

Onlooker

We have posted calculations in these pages calculated very carefully to ensure readers are informed.Again in general terms a £60,000 release debt will double the amount to be repaid in 14/15 years triple after about 20/21 years and continue annually.
There is only one redress ,as has also been mentioned,the effect of housing inflation on anyones property.There is no known guarantee as to what this will be in the future,up or down..
Waiting for the financing turmoil to show itself will cost nothing and will save everyone some monies.Consider

Thrugelmir

Onlooker wrote: »

We have posted calculations in these pages calculated very carefully to ensure readers are informed.Again in general terms a £60,000 release debt will double the amount to be repaid in 14/15 years triple after about 20/21 years and continue annually.

Einsteins 8th law is nothing new. Compound interest is something that everyone should comprehend while at school.

Onlooker

The message coming through with regard to house price inflation reiterates that house prices are looking likely to fall this year.Anyone with a Lifetime Mortgage will be adversely affected and new estimates on what the margin of the loans taken out,which will continue to escalate, against house prices will be.That is and always will be the risk in this kind of borrowing.To wait for some surety one way or the other may save borrowers a great deal.Consider