Secured loans with deferred payment arrangements?

Loriole

Does anyone other than local authorities provide deferred payment secured loans at non-eye-watering rates?

My wife and I, aged 84 and 78 respectively, are cash strapped but asset rich, to the tune of a mortgage-free house worth £400,000 that we have dutifully willed to our daughter and family.

We get by on our pensions, supplemented by dips into our savings for ‘exceptional’ spending. This has varied over the past 10 years, having been more than £5,000 in a year. We would like to keep it below £2,000.

However, with savings now down to £9,000, we are feeling insecure and restricted. An additional £15,000 would leave us free to enjoy the occasional indulgence.

[Deleted User]

Equity release would seem to be the only way forward.

foxy-stoat

Deleted_User said:

Equity release would seem to be the only way forward.

Run that past your Daughter and family - if you crunch the numbers it will be much better for them to give you 15 large to enjoy, they will be getting it back a few times over at some point anyway.

Loriole

zx81 and foxy-stoat
Thanks for your thoughts.
Two things:

• Daughter and family don't have the wherewithal.
• Where does one find favourable numbers to crunch? 

sourcrates

Loriole said:

• Where does one find favourable numbers to crunch? 

Google is your freind here -

https://www.savemoneymarket.co.uk/compareequityrelease

Loriole

Many thanks to all concerned. It's been a learning curve for me in as much as I hadn't realised that secured loans and equity release are the same thing.
In the meantime I've discovered https://www.moneyadviceservice.org.uk/en/articles/lifetime-mortgage - which includes a guide to FCA recognised advisers https://www.equityreleasecouncil.com/find-a-member/advisers/ - to which I can add Sourcrates' recommendation.

foxy-stoat

Loriole said:

zx81 and foxy-stoat
Thanks for your thoughts.
Two things:

• Daughter and family don't have the wherewithal.

Shame, go ahead with the equity release then.  They wont miss what they don't understand.

jonesMUFCforever

Is an interest only mortgage an option although it would have to be for a minimum of £25,000 with most lenders?

tlc678910

Hello,
Check carefully penalties for settling the equity release early if you want to or need to move. I understand these can be hefty so make sure you know what applies. I have heard in the past that charges apply unless the person "needs" to move to a care home and of companies trying to apply the charges if only one of the couple "need" care and the other simply prefers to move also. Just make sure you understand in what circumstances penalties apply.

Would you consider downsizing to release equity. Obviously you would own your new property outright so no interest to pay or to compound and eat away at the equity in your property. It is a good time to move with stamp duty suspended.  You might even choose to treat your children for example if you free up a larger amount giving them a few thousand each.

[Deleted User]

Forget your daughter and family they can fend for themselves, the answer seems to be to down-size to free up capital or equity release.