Equity Release guide discussion

Nick_Lovell

snowball3 said:

Nick_Lovell said:

snowball3 said:

Nick_Lovell said:

snowball3 said:

My mum is terminally ill and has recently needed a live in carer. While she has the money at the moment to pay for it i am looking at options as what to do when the money runs our. She owns her own home, value approx £500k. Any advice would be appreciated.

This is a tough one. And so sorry to hear, have to ask but does your mother have mental capacity? If she does you can pursue equity release for immediate healthcare needs. However, if she has lost capacity then you would need a Lasting Power of Attorney in place to act on her behalf. Potentially up to 40-55% of the house value can be released depending on age. She would be deemed a vulnerable client and care would need to be exercised in the advice process.

I have a power of attorney for her for finance and health. She doesn’t have mental capacity to make decisions. 
Are there any other ways of releasing money like an interest only mortgage?

There would not be any other routes for releasing funds from the property as affordability criteria would come into play. The lifetime mortgage is legally a first legal charge mortgage and does not differ from a RIO in a legal charge format - the interest can still be serviced on a lifetime mortgage as well. The benefit is that there is no affordability criteria. With the LPA you are able to proceed on her behalf. 

Thanks. I was trying to find a cheaper option than equity release where there is compound interest. I will get some advice when we are closer to the money running out 

You won't suffer compound interest if you service the interest, which you have the flexibility to do. I would consider setting up a facility soon, as with LPA applications they are fully scrutinised and can take a long time to get approved as lenders are very cautious. Happy to help.

snowball3

Nick_Lovell said:

snowball3 said:

Nick_Lovell said:

snowball3 said:

Nick_Lovell said:

snowball3 said:

My mum is terminally ill and has recently needed a live in carer. While she has the money at the moment to pay for it i am looking at options as what to do when the money runs our. She owns her own home, value approx £500k. Any advice would be appreciated.

This is a tough one. And so sorry to hear, have to ask but does your mother have mental capacity? If she does you can pursue equity release for immediate healthcare needs. However, if she has lost capacity then you would need a Lasting Power of Attorney in place to act on her behalf. Potentially up to 40-55% of the house value can be released depending on age. She would be deemed a vulnerable client and care would need to be exercised in the advice process.

I have a power of attorney for her for finance and health. She doesn’t have mental capacity to make decisions. 
Are there any other ways of releasing money like an interest only mortgage?

There would not be any other routes for releasing funds from the property as affordability criteria would come into play. The lifetime mortgage is legally a first legal charge mortgage and does not differ from a RIO in a legal charge format - the interest can still be serviced on a lifetime mortgage as well. The benefit is that there is no affordability criteria. With the LPA you are able to proceed on her behalf. 

Thanks. I was trying to find a cheaper option than equity release where there is compound interest. I will get some advice when we are closer to the money running out 

You won't suffer compound interest if you service the interest, which you have the flexibility to do. I would consider setting up a facility soon, as with LPA applications they are fully scrutinised and can take a long time to get approved as lenders are very cautious. Happy to help.

That is good to know. I didn’t realise that the interest could be paid. When you say a long time how long approximately would we be looking at? Thanks very much for your help.

Nick_Lovell

snowball3 said:

Nick_Lovell said:

snowball3 said:

Nick_Lovell said:

snowball3 said:

Nick_Lovell said:

snowball3 said:

My mum is terminally ill and has recently needed a live in carer. While she has the money at the moment to pay for it i am looking at options as what to do when the money runs our. She owns her own home, value approx £500k. Any advice would be appreciated.

This is a tough one. And so sorry to hear, have to ask but does your mother have mental capacity? If she does you can pursue equity release for immediate healthcare needs. However, if she has lost capacity then you would need a Lasting Power of Attorney in place to act on her behalf. Potentially up to 40-55% of the house value can be released depending on age. She would be deemed a vulnerable client and care would need to be exercised in the advice process.

I have a power of attorney for her for finance and health. She doesn’t have mental capacity to make decisions. 
Are there any other ways of releasing money like an interest only mortgage?

There would not be any other routes for releasing funds from the property as affordability criteria would come into play. The lifetime mortgage is legally a first legal charge mortgage and does not differ from a RIO in a legal charge format - the interest can still be serviced on a lifetime mortgage as well. The benefit is that there is no affordability criteria. With the LPA you are able to proceed on her behalf. 

Thanks. I was trying to find a cheaper option than equity release where there is compound interest. I will get some advice when we are closer to the money running out 

You won't suffer compound interest if you service the interest, which you have the flexibility to do. I would consider setting up a facility soon, as with LPA applications they are fully scrutinised and can take a long time to get approved as lenders are very cautious. Happy to help.

That is good to know. I didn’t realise that the interest could be paid. When you say a long time how long approximately would we be looking at? Thanks very much for your help.

A standard application takes 8-12 weeks, but I would allow minimum of 12 weeks and possibly up to 16 weeks. The importance is ensuring that it is fully compliant, so needs to be packaged correctly with the full advice process.

snowball3

Nick_Lovell said:

snowball3 said:

Nick_Lovell said:

snowball3 said:

Nick_Lovell said:

snowball3 said:

Nick_Lovell said:

snowball3 said:

My mum is terminally ill and has recently needed a live in carer. While she has the money at the moment to pay for it i am looking at options as what to do when the money runs our. She owns her own home, value approx £500k. Any advice would be appreciated.

This is a tough one. And so sorry to hear, have to ask but does your mother have mental capacity? If she does you can pursue equity release for immediate healthcare needs. However, if she has lost capacity then you would need a Lasting Power of Attorney in place to act on her behalf. Potentially up to 40-55% of the house value can be released depending on age. She would be deemed a vulnerable client and care would need to be exercised in the advice process.

I have a power of attorney for her for finance and health. She doesn’t have mental capacity to make decisions. 
Are there any other ways of releasing money like an interest only mortgage?

There would not be any other routes for releasing funds from the property as affordability criteria would come into play. The lifetime mortgage is legally a first legal charge mortgage and does not differ from a RIO in a legal charge format - the interest can still be serviced on a lifetime mortgage as well. The benefit is that there is no affordability criteria. With the LPA you are able to proceed on her behalf. 

Thanks. I was trying to find a cheaper option than equity release where there is compound interest. I will get some advice when we are closer to the money running out 

You won't suffer compound interest if you service the interest, which you have the flexibility to do. I would consider setting up a facility soon, as with LPA applications they are fully scrutinised and can take a long time to get approved as lenders are very cautious. Happy to help.

That is good to know. I didn’t realise that the interest could be paid. When you say a long time how long approximately would we be looking at? Thanks very much for your help.

A standard application takes 8-12 weeks, but I would allow minimum of 12 weeks and possibly up to 16 weeks. The importance is ensuring that it is fully compliant, so needs to be packaged correctly with the full advice process.

Thank you. I have a bit of time until the cash runs out.

sondheimsoc

Hi, just over 3 years ago we moved (downsized) to a new home for our old age. Unfortunately all we could get was something in need of renovation and we chose the worst time to do it for costs and availability of materials and builders.

Although I have worked all my life, I hardly have any work pension as when we had our first child in 1981 we were totally broke and at that time you could withdraw all your superannuation which we had to at that time basically to survive, (and I went back part time to work when he was 6 weeks old). Consequently, although I am 73 I am still having to work (my husband is 71 and retired as a result of redundancy some years ago). The idea was that our previous house would have been instead of my pension but as outlined above, that didn't work out.

I'm self-employed ( I am one of those people who find people to attend focus groups as mentioned elsewhere in MSE forums). But since the pandemic, work has become very patchy and hard to find, plus I don't find it as easy as I did when I was younger. So I have been wondering about ways to use the house to provide an income so that I could finally retire.

I reckon that it's worth about £525,000. I'd appreciate any thoughts about the best way forward. (I've read the article on the site).

Thanks

Lynne