Equity release

Ak92

Hello posting this on behalf of my mum.

Currently she lives in our family home which is mortgage free. My mum and dad have been divorced for 14 years and my dad now wants 50% of the family home we live in. The divorce settlement states that he is entitled to 50% of the net value of the property. This stands in the region of £100,000.

She would like to know her options. We have spoke with a few estate agents and some have highlighted equity release- is this the best option? IDEALLY she would like to remain in the house and not have to move out. Just want to know If equity release is the best option for my mum who does not want to sell up and move but has to pay my dad out.

Sorry if this doesn't make sense but I will try and answer any questions. Thanks for reading.

greyteam1959

You should be speaking to a solicitor NOT an estate agent.

merrydance

A financial adviser would be able to help you.

dimbo61

Is mum working or now retired ?
Income, credit score, age are all factors which need to be considered when looking at raising the £100K her EX husband now wants from the equity in the property.
Was there a mortgage on the property 14 years ago ? Did Mum and Dad pay this mortgage debt off.

Silvertabby

Is it not 50% of the equity in the property as at the date of the divorce? As has been said already, it's legal advice your mum needs now.

Linton

How old is Mum? I think she may have problems finding an ER provider who would lend 50% of the property value. Look at a few screens down https://www.aviva.co.uk/retirement/already-retired/equity-release/. Most calculators want a name and address but this one doesnt.


If she wants to follow up on the idea she should talk to an IFA or mortgage broker with specialist ER knowledge.

Ak92

Thanks for all your replies, we are currently finding a financial advisor to speak with. Got an appointment for next week.

Mum is 48 and is working full time, there was a mortgage 14 years ago which my dad paid off (as part of the divorce settlement). Thanks for the info and replies.

Thrugelmir

Ak92 wrote: »

Mum is 48 and is working full time, there was a mortgage 14 years ago which my dad paid off (as part of the divorce settlement). .

Then equity release isn't the answer. Remortgaging to buy him out seems the way forward if possible. That or downsizing.

D_M_E

As Silvertabby says, you need to check if the divorce settlement said 50% of value at the time of settlement OR 50% when property is sold.

If value at time of divorce then it will be a lot less than 50% of current value.

However, if 50% at time of sale, then as no sale is presumably imminent then no payout.

She needs a solicitor to advise and also needs to look again at what the terms of divorce settlement were all those years ago.

Thrugelmir

D_M_E wrote: »

As Silvertabby says, you need to check if the divorce settlement said 50% of value at the time of settlement OR 50% when property is sold.

If value at time of divorce then it will be a lot less than 50% of current value.

However, if 50% at time of sale, then as no sale is presumably imminent then no payout.

She needs a solicitor to advise and also needs to look again at what the terms of divorce settlement were all those years ago.

The terms of the settlement were most likely to allow the ex-wife to remain in situ. Until such time as all the children had left full time education. As he paid the mortgage off. Then a split of 50/50 of the equity equally seems probable.