help please

AMBERSHADOW

I wonder if you can help please?


My mother and father in law moved home roughly 25 years ago, they wanted new windows and doors and took out a loan for this purpose so we thought, The loan was in fact a type of loan secure on the house they have but didn't offer any pay back terms until death.


Since then the term has gone from £4,500 to over 50,000 and still rising, We have tried to come to some arrangement with the company but they are telling us nothing can be paid until the house is sold or the owners die.


Now my father in law died 4 year ago and mother inlaw needs to go into residential care but not sure how to go about this due to this loan secured on the house with rising interest all the time.


I am not sure they fully understood what this meant at the time of taking out and it looks like my Mother in law will have nothing left to pay for her care..
Can you please adivse?


Sorry if this is the wrong place to post

[Deleted User]

You'll need to find the terms of the loan, but essentially you have the choice of letting it run and be settled from the estate, or clearing it now.

I'd be surprised if an early settlement wasn't possible, particularly upon sale of the house.

AMBERSHADOW

Deleted_User wrote: »

You'll need to find the terms of the loan, but essentially you have the choice of letting it run and be settled from the estate, or clearing it now.

I'd be surprised if an early settlement wasn't possible, particularly upon sale of the house.

We have only recently found out about this and contacted the company to make a payment to bring down the amount owed..
They tell us that they had Solicitor present to witness the signing of the document, Now I know for a fact that if my parents in law didn't have the money for the windows they surely wouldn't have had the money for a Solicitor to go to their home to over see this signing, So I am presuming its the companies solicitor ..


My Mother in law is just not coping very well and can't remember any details at all.. however that said she says there was no solicitor present.


The company refuse to give any details yet my Husband their son has power of Attorney... Its all so iffy to me I just cant get my head round someone borrowing 4.500 for windows when infact its going to be well in to the 70,000 before payment

Paul_DNAP

Yes, home equity release loans are "very iffy" but are startlingly legal and binding. It appears to take out a small loan with the promise "don't worry, your house will pay it back when you die" - but what they don't make massively clear is that although you don't make any payments, the interest starts accruing from day one at sometimes quite hefty APR (looks like theirs is between 9 and 10%). And, no payments are being made the interest compounds on itself like a plague making the debt double every seven years or so.


Such loans rarely have any early redemption clauses, but they will be limited to a maximum total repayment of the market value of their house.


The "solicitor" almost certainly will have been from their side accompanying the "salesman" and your parents will certainly have paid for him - they will have added his wages onto the loan amount as part of the "arrangement fees" which could easily be another grand on top.


There are far too many documented cases where the heirs to an estate suddenly find out someone else owns their family home due to this kind of shyster.


And this is all perfectly legal, makes you feel ill don't it?

AMBERSHADOW

Paul_DNAP wrote: »

Yes, home equity release loans are "very iffy" but are startlingly legal and binding. It appears to take out a small loan with the promise "don't worry, your house will pay it back when you die" - but what they don't make massively clear is that although you don't make any payments, the interest starts accruing from day one at sometimes quite hefty APR (looks like theirs is between 9 and 10%). And, no payments are being made the interest compounds on itself like a plague making the debt double every seven years or so.


Such loans rarely have any early redemption clauses, but they will be limited to a maximum total repayment of the market value of their house.


The "solicitor" almost certainly will have been from their side accompanying the "salesman" and your parents will certainly have paid for him - they will have added his wages onto the loan amount as part of the "arrangement fees" which could easily be another grand on top.


There are far too many documented cases where the heirs to an estate suddenly find out someone else owns their family home due to this kind of shyster.


And this is all perfectly legal, makes you feel ill don't it?

yes it certainly does.. Would this have been legal 26 or 27 years ago when they took it out?
I am not sure I agree with them saying we cant pay back

[Deleted User]

Yes - it was a legal loan.

DCFC79

Try sending a SAR, if a solicitor was present it should be in the documents.

AMBERSHADOW

DCFC79 wrote: »

Try sending a SAR, if a solicitor was present it should be in the documents.

Thanks so much!


Can you point me in direction of SAR template please?

Willing2Learn

The link below explains the SAR process and includes a handy letter template too

https://ico.org.uk/your-data-matters/your-right-of-access/

AMBERSHADOW

Willing2Learn wrote: »

The link below explains the SAR process and includes a handy letter template too

https://ico.org.uk/your-data-matters/your-right-of-access/

Thank you very much!


This site is the best and the people are second to none for helping out :-)

sourcrates

How old were they when they took out the loan ?


Minimum age for equity release is 55.