Best way to raise cash on mortgage free home

I'm in the process of selling my home of 17 years, which after paying off my mortgage & debts leaves me just enough to outright buy a much smaller old property in Scotland & cover the essential repairs (damp & roof) raised in the survey. The new house is tiny & needs work but has a maze of brick built garage/outhouses, some of which are attached to the house. I want to make sure my kids don't lose out on me swapping a £150000 house (before debts paid off) for an £80000 one, and have space for family to visit and also not feel too cramped so I was thinking once I have got a job in the new area of looking to either try and get a very small new mortgage or equity release on the new house to convert an outbuilding to usable space & increase the value. What would be the best way to do that? I'm 55 & have already cashed my tiny pension in to do repairs and pay off some debts prior to selling. I gave my shop up ready to move so could not apply for anything prior to establishing myself in Scotland, and just can;t afford anything bigger or in better condition. Any advice on whether a secured loan, equity release or remortgage would be best would be greatly appreciated,

Replies

  • Declan1992Declan1992 Forumite
    62 Posts
    Hi

    Your going to struggle to get any time of finance until you have been in paid employment for at least 6 months really.

    First key is to gain employment and visit your situation after about 6 months and a mortgage at your age would be around 10 years really. I’d suggest a loan and pay the hell out of it or a 0% CC if possible.
  • getmore4lessgetmore4less Forumite
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    I want to make sure my kids don't lose out on me swapping a £150000 house (before debts paid off) for an £80000 one

    They have not lost anything the money did not exist if there were debts.

    Get the kids to fund the improvements either before or after you have gone.
  • Nebulous2Nebulous2 Forumite
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    How handy are you? Could you diy for the cost of materials?

    If you're staying somewhere that houses with a range of outbuildings are £80k it's unlikely that converting one of them will be a reasonable financial proposition. There are reasons for that, conversion costs are high, budgets on them often overrun and you still have some of the maintenance costs of an old building.

    Much of rural Scotland you'll see the villages and towns divided in two. Cheap old property that is rented out, holiday accommodation or often empty on one hand and modern new-build property which sells well and is owner-occupied on the other. Converted buildings don't fit either type and is difficult to price.

    If there is a lot of ground attached to your buy, then knocking some of the buildings down, getting planning permission and building a new property would often be more viable.
  • JMA74JMA74 Forumite
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    Your age doesn't stop you getting a conventional mortgage..
    Once you have a job lined up then you can ask a broker to source a mortgage. It's possibly to do this prior to your start date if you've got a contract, ideally you would have at least 1 payslip though and it opens up more choice.

    A normal mortgage would be the cheapest way of doing it and you could still have up to a 24 year term with certain lenders depending on your plans.

    If you wait until you own it and then try mortgage it you will be doing a remortgage and they are very competitive on rates at the moment with little in the way of set up cost
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  • They have not lost anything the money did not exist if there were debts.

    Get the kids to fund the improvements either before or after you have gone.
    Bit harsh ;-) I'm all they've got & I'd like to help them and the grandkids a little bit, that's all
  • Thanks to everyone who's responded so quickly with various ideas. Yes I'm OK with DIY and will be doing all the simpler work on the main house & garden, I draw the line at anything involving actual building. I certainly can't afford to knock down & rebuild or I would've just bought a plot cheaper. It's hard to describe the outbuildings but one is an old brick garage actually attached to the house (but not thru a door) with stairs to an attic room. It already has double glazing on one window, but the other one is ancient and one wall opens into a bigger 'room 'full of junk & tools. It was the attached garage I thought i might look into doing up as a room.
    You've all helped confirm that I will have to be patient, which I'm not great at. Do the basics myself on the house and once established in work, look into a secured loan or remortgage. I'm glad no one recommended equity release as it seems quite a high price to pay although handy to get money not to have to pay back immediately. My impatient self was tempted but I'll stick to conventional options. Thanks all.
  • They have not lost anything the money did not exist if there were debts.

    Get the kids to fund the improvements either before or after you have gone.

    Just for clarity, if I stayed here the mortgage would be paid off in 8 years so they'd get the lot. Classic single parent guilt - I worked 2 almost full time jobs for years when they were young (no idea now how I did it) to be able to buy after some bad renting experiences & try & help make their lives a bit easier as adults. Now I have grandkids and see them struggling to work and a raise family I wish I hadn't put so much into working. Just my way of making it up to them I guess.
  • OP, I don't know if you read this. So I'll repeat the important points -

    1. 55 is not too old for a mortgage. You can potentially go all the way up to 80, ie a 24 year term.

    2. You don't need to be employed for 3/6/12 months before applying for a mortgage. There are lenders who will lend based on a contract and start date, more with 1 payslip.

    Once ready, I would recommend talking to whole of market broker who will give you a realistic idea of the options open to you after looking at the enitrety of your circumstances.

    Good luck with the move!
    JMA74 wrote: »
    Your age doesn't stop you getting a conventional mortgage..
    Once you have a job lined up then you can ask a broker to source a mortgage. It's possibly to do this prior to your start date if you've got a contract, ideally you would have at least 1 payslip though and it opens up more choice.

    A normal mortgage would be the cheapest way of doing it and you could still have up to a 24 year term with certain lenders depending on your plans.

    If you wait until you own it and then try mortgage it you will be doing a remortgage and they are very competitive on rates at the moment with little in the way of set up cost
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