Money Draw Down

killie77

Hi

Have a property which I bought around 6 years ago. I'm assuming it's worth between £110000 to £115000, at the moment.
Its owned out right. I paid cash when I bought it.
I'm trying to work out the easiest and cheapest way to draw down some money. I'm 67 and my Wife is 62. 
Any advice would be most welcome

Ian

[Deleted User]

If you have sufficient income, then a mortgage would be the norm. But it depends on what your longer term plans are, your repayment ability, how much you need, and whether you intend to leave any inheritance. 

killie77

I'm on the State pension and my Wife works part time. I'm guessing at our age we wouldn't qualify for a mortgage.

[Deleted User]

Some lenders will do it up to 70 if your income supports it and it could be paid off 

If you don't have any kids to leave money to (or don't care either way), you could look at equity release but keep in mind the plans are expensive with compound interest and when both parties die, the house is sold to repay the loan and anything left goes to the estate.

Ebe_Scrooge

The property you're talking about - is this where you live, or is it a second home?  If the latter, then simply selling it could well be the easiest route.

Aside from that, how much money are you looking for, and for what purpose?  As Farfetch says, there are many equity release products out there, but they're expensive in the long run and the usual advice is to avoid them.  But what about a standard personal loan?  As long as you have sufficient income then this may be a feasible option.

killie77

Thanks for the replies.
It's a 2 bedroom flat which is our only residence. Were looking at around 30000 and it would be great if we could access at 10000
Per draw down. I've looked in to equity release spoke to a financial advisor, who was very forthcoming regarding the pitfalls and the wealth of charges incurred. He mentioned that although I could probably get an equity loan. My age at 67 is actually
Lower than the equity people like. I guess I have to have one foot in the grave, which would be more to their liking 😀
I have been approved for a ten thousand pound loan from Hitachi Capital, but the interest is higher than they first promised.
So I'm not taking the loan at this time.

Ebe_Scrooge

killie77 said:

I've looked in to equity release spoke to a financial advisor, who was very forthcoming regarding the pitfalls and the wealth of charges incurred.

I think you've probably made the right choice in deciding against the equity release option - those schemes do have something of a bad press.

killie77 said:

I have been approved for a ten thousand pound loan from Hitachi Capital, but the interest is higher than they first promised.

All loans will advertised a "representative" APR, but it's not until your individual application has been processed and they've checked your credit file that you'll find out what rate they're prepared to offer you personally.

So if equity release and a loan are not options, a standard mortgage might be worth considering, as has been mentioned by a couple of previous posters.  Although, most lenders won't offer a mortgage for less than about £20K - and of course, they would assess the affordability against your income.

The purpose of the loan might have some bearing on your ability to get finance.  For instance, mortgage lenders tend to be more willing to advance loans if it's used to add tangible value to the property.  Or if it's for a car, there are several finance options available, which are essentially loans secured against the car.  If it's for something "non-tangible" such as a holiday, then you're pretty much restricted to more conventional types of personal loan or similar (or savings!).

Brie

Would a flexi mortgage be an option?  (I don't know hence this being a question)

Are mortgage is a flexi sort but we've had it for years but it means that while it's against the equity of the house we live in we can take out any amount up to the max allowed.  So for us that's anything from zero to £50k.  The interest is high for a mortgage (4%) which is why I aim to have it at as close to zero as possible but am willing to pay for the flexibility as we've a lot happening in our lives.  Ours is a VirginOne account which are no longer available but other similar products are available.

killie77

Thanks

I'm with the Clydesdale Bank,which was recently taken over by virgin money. I asked about a flexible mortgage, but they don't do them,i was told. I have an account with Bank of Scotland so may enquire their.

we_mean_clean

Mortgage or equity release