Will Equity realease affect my benefits and Pension credit

andyb53

Hello all 

I am a 68 yr. old man . A pensioner and in receipt of Pension Credit.  In May of next year, I will need to redeem my Mortgage OF £174,000..  I have no way of repaying this other that the possibility of Equity released as I have a house worth around £360,000.   I stress I would ONLY use any Equity Release to repay my existing mortgage so I can continue live in my home.  My overall income, saving etc would not change.   

 My question is this.... Will Equity Release affect my Pension Credit?  I stress I am only using to to pay the mortgage that HAS to be repaid and nothing else!  Andy advice will be appreciated  Thank you

calcotti

I see no problem with that. Your motive for equity release is clearly to pay the mortgage so deprivation of capital should not be an issue. You should try and keep the period of time you have the money to the minimum possible. 

MovingForwards

As you will have a solicitor handling the equity release (conveyancing side), they can receive the money from the ER company and instantly repay the mortgage. The money would never even touch your bank account unless there was some change left over.

kaMelo

andyb53 said:

Hello all 

I am a 68 yr. old man . A pensioner and in receipt of Pension Credit.  In May of next year, I will need to redeem my Mortgage OF £174,000..  I have no way of repaying this other that the possibility of Equity released as I have a house worth around £360,000.   I stress I would ONLY use any Equity Release to repay my existing mortgage so I can continue live in my home.  My overall income, saving etc would not change.   

 My question is this.... Will Equity Release affect my Pension Credit?  I stress I am only using to to pay the mortgage that HAS to be repaid and nothing else!  Andy advice will be appreciated  Thank you

Looking at your figures you're almost at 50% which is very close to the limit of what you could borrow with equity release.
Assuming you could though then regarding repaying the mortgage, you wouldn't get a choice in the matter. The equity release provider wants first charge on your home so will pay off any loans secured on the property before they do anything else. The only money you will receive in hand is anything left over after it/they are paid in full.