Lifetime Mortgage

MWT

Onlooker2 said:

Discuss the early repayment charge which is payable at 25% on top off your original borrowings  from day one and is a cost that has to  taken into account by all .

... and yet more out of date fear mongering unfortunately...

It is easy to find products with 'low' and reducing ERC clauses these days.

For example, 10% reducing at 1% per annum down to 1% then fixed for 5 years after which it goes to zero.

So much of what you post has been coloured by the poor deal you did a long time ago and bears no relevance to the current products, the current regulation and the current standards of advice...

Onlooker2

Take notice of the well paid TV presenter now being employed to promote Equity Release by way of committing to a mortgage for your lifeime.He states a truth,your home is your castle.To keep it all and not lose a large proportion which could be the outcome if you borrow monies in this manner.Consider

ledonster

Agreed. Perhaps some folk should buy smaller castles and pay a bit more into their pensions so they don't need to resort to these products later on. Consider 

Onlooker2

The TV enticing adverts seem to be leading people into  financial problems in their future.The said presenter suggests that homeowners take out Equity Release loans so they can become the bank of mum and dad.Sounds charitable to anyones siblings but can cause problems.
The Deliberate deprivation of assets will be taken into account against anyone who has to go into long term care.If local councils have to take this into account as being done to avoid paying care home fees and go to the extent of claiming such monies back from the recipients of these monies.Consider.

MWT

Onlooker2 said:

The Deliberate deprivation of assets will be taken into account against anyone who has to go into long term care.If local councils have to take this into account as being done to avoid paying care home fees and go to the extent of claiming such monies back from the recipients of these monies.Consider.

That isn't how it works...

Firstly the gifts would have to be close enough in time to a claim for support for the fees before it would be a factor, a gift made at a time when no such claim was anticipated would not cause a problem and even if it was done close to a claim the result would be a denial of the claim, not an attempted recovery of the gift from the recipient...

Yes, due consideration to the impact on ability to receive various benefits is important and forms a part of the advice that is required under current regulations.

Onlooker2

Wait,that is what all homeholders should do .Wait until the financial crisis we are all included in is resolved.It took 5 years the last time a crisis less worse than this arose.The lenders dont know other than try to entice people into what is the most expensive way of borrowing against you property..All interest are at low,lower than releasing equity i.e a mortgage for your lifetime with interest compounding year on year.Wait ,borrow short term until your and everyone elses financial future .becomes clearer
The TV advert from the star says life really can better with age,a play on words there.Consider

Onlooker2

Today is part of the festive season which has unfortunately being spoilt for millions .Why then does the Lifetime Mortgage suppliers pick this time to, with the use of a millionaire TV star showing up at 8.50 this morning to try to entice householders to spoil the rest of their lifetime bank holidays by signing into this way of borrowings.He would probably not have to take a loan out this way ,neither would anyone else employed in this industry   do it against their own paid for properties Cheaper alternatives are  well advertised.Go to your own bank,even your own families.Wait ,enjoy these holidays as best you can and leave this way of paying year on expensive year alone Consider.

Onlooker2

Recent post describes how an 91 year old man,unknown to his family,was sold a Lifetime Mortgage by this industry..Could he have had really enough awareness as to what cost he was committing his future financial life to.Were the regulations and standards abided by?We were not made aware enough 11 years ago,can we prove it ,no.Regulations may have got better but are of no use to the large numbers who are still committed to owing more and more annually.Look elseware.Consider

ledonster

A good adviser will always seek to involve family members in the process from the start. Ideally, they will support their relative and do away with the need for a lifetime mortgage in the first place! Sometimes, clients refuse to involve the children in which case, they should confirm this in writing. Ultimately, one had to question what sane person would do something as permanent as entering into a lifetime mortgage without reading all the paperwork. You cannot blame the adviser I'm afraid. There is no excuse for not taking responsibility and reading all the relevant information before signing anything. As for alternatives available, there aren't always any... Oh wait..... Perhaps a little bit of saving into a pension in the preceding 40 + years of work would help. There should be no need for these products if only we paid a little each month into pensions. Consider 

MWT

ledonster said:

As for alternatives available, there aren't always any... Oh wait..... Perhaps a little bit of saving into a pension in the preceding 40 + years of work would help. There should be no need for these products if only we paid a little each month into pensions. Consider 

That is a very narrow view of the uses for the product, it is not always to provide income, or worse to allow the purchase of depreciating assets like cars or discretionary spending like vacations.

Releasing equity to assist with another property purchase for example can be a good use of the product, and the oft quoted dangers of compounding interest is only an issue if you let it roll-up without paying any of it off, and even then, the 'danger' is mostly not to the borrower, but to those hoping to inherit from the borrower so 'danger' is often over used...

The modern products are very flexible and well regulated, and advice is just that, advice, not 'selling'.

Just because someone is older when taking this sort of product does not automatically mean they are financially incompetent...