Drawing cash from house

Mr_Warren_2

Hello all. Hoping to find you all in great health and spirit.
We are nearly mortgage free (still owing £1300 that I do not want to pay off for reasons). House is worth £500k

Question: What kind of method would allow us to release cash out of the house (thinking £100k) ?? We do not want yo consider equity release.

Thank you all for your responses.

tacpot12

You should talk to your existing lender about whether they will allow you to increase your borrowing that is secured on the house for the purpose that you want £100K. 

zagfles

What do you mean "release cash out of the house"? Obviously the only way to do that is sell it and buy a cheaper house. If you want £100k, then you probably need to look at houses about £350k when you account for all the buying and selling costs.

You could just borrow £100k, perhaps secured against the house, but that's not releasing cash, that's just borrowing. Eg take out a new mortgage, extend your existing one. But like all borrowing, you need to pay interest, and eventually pay it back. You could plan to pay it back out of your estate when you die, but that's similar to "equity release".

Mr_Warren_2

Thank you both, sorry for late acknowledgement,  I have been away.

So basically, there isn't a scheme that would lend now and get repaid when we eventually sell?? 

Emmia

I think only equity release might work - what's your aversion to that? 

zagfles

Mr_Warren_2 said:

Thank you both, sorry for late acknowledgement,  I have been away.

So basically, there isn't a scheme that would lend now and get repaid when we eventually sell?? 

Of course there is, a "mortgage", but you know about that as you already have one. Or an "equity release" mortgage where you don't need to make payments but obviously the interest then rolls up and compounds, but you said you don't want one of them. I don't know what else you were expecting?

powerspowers

An interest only mortgage? 

A regular repayment mortgage may be your best bet if it’s affordable. You’ve got a great LTV so the interest should be low. 

I think you either need to get some advice