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Home for Life Plan
Bolt1234
Posts: 314 Forumite
Could someone explain the pros and cons of a Home for Life Plan. Relative mid 80's lives in a house worth £400k. He wants to downsize and has been looking at a Home for Life Plan. He is mortgage free in his current house and a few £100k's in savings. Is this a good idea for him? Otherwise what about renting? He is not too bothered about owning a house again.
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Comments
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Completely depends, I'm not sure I'd be thinking of moving in to rented at 85 but presume there are reasons (house too big to take care of / mobility issues?) Personally I'd still buy something outright, might still live to 100+ and would hate to have to move on anyone else's timetable that late in life or have any restrictions on what I could do, but if there are no cares about protecting inheritance etc and they see something they like then it's not a completely ludicrous plan.
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I think these plans are for people needing to free up equity. Your relative can just sell his place and move to another, more suitable property.0
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If I were him I'd sell up and buy a retirement property that can potentially offer extra care as he gets older. Home for Life plans are generally for people who don't have enough equity to sell up and purchase their next home. It doesn't sound like it applies here.
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But care needs to be taken even with these properties as when they are no longer needed, they often take some time to sell, sell at less than was paid, and in the intervening period service charges (which obviously are quite high) need to be paid.
https://forums.moneysavingexpert.com/discussion/comment/76833286#Comment_76833286 This is a relevant thread, there are others.
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