Single parent buying a house with cancer

Caleyloch

Hi,

I am hoping for some advice please about my current situation and purchasing a property.

I am a single parent to a teenager with an incurable but manageable cancer. I work full time and feel in good health with all things considering! 

 I have been given some money (£30k)by a relative which would help me get onto the property ladder, but a mortgage will still be required. I won’t be able to get life insurance because of this. I have spoken with MacMillan Cancer finance team and they advised that it life insurance is not legally required for a mortgage. 

My dilemma is whether to go ahead with the property purchase or not. My financial advisor seems hesitant but said they would try and help me.  Am I being foolish to even consider this?  What would happen if I died? Would I lose the money I put into the property as the bank would take back the house and sell it. Or would my teenager be able to claim that £30k back? 

There are people who have the same condition as me that have gone over 15 years without ever needing treatment and during treatment, most can work. 

I’m so torn about this. 

Thanks

silvercar

Sorry you are in this situation, I hope medical advances mean that the outlook is even better.

If the worst should happen. Without life insurance the lender would want the outstanding mortgage repaid. This would require someone else to take out a mortgage to replace your current mortgage, find the money from savings/ inheritance or elsewhere or the property sold. Depending when this occurred the property may be worth more (so that 30k would have been a good investment) or the outstanding mortgage may be lower than when you take it out. 

If the bank did repossess the house, then they have a duty to get the best price for it. Any equity left over after the mortgage is repaid would be returned to your estate.

ACG

In essence the home would form part of your estate. 
The property would be sold, debts cleared and the rest would be passed to your next of kin (maybe make a Will just to ensure this is as easy as possible for your daughter). 

The next part, I am sorry to sound blunt. Please do not take this as being heartless... I think you need to weigh up any life expectancy against what you expect to happen with property prices. I know that some cancers can be treated and you can live a normal life for decades, others are very different. If you are going to buy and you think house prices will drop and probably not recover, then you might be best renting. 

I think you need to speak to a solicitor also about potentially putting some/all of the money in trust for your daughter. 

It is difficult to say what you should/should not do with so little information. I can imagine it being quite a difficult period. Assuming you do not want to give out your personal details online, it might be worth calling a broker and seeing if you can have a chat with them and they can discuss it on a personal level with you. 

Caleyloch

Hi again,

Thanks very much for both helpful responses.  That’s good to know that any equity will not be lost.  

I do understand there will be risks and maybe not putting all the money into the property is a better idea. It would just be nice to have the security of having a permanent place to stay after years of moving to different rentals. 

I do wish I could have a crystal ball to help me! 

I’m worried that the lender will place conditions on the mortgage such as asking for life insurance details. Does this happen regularly? 

ACG

It never happens. They wont ask about your health. 

elsien

Just to flag up as another factor to consider, you also need to think about what happens if there’s a prolonged period where you’re more ill and not able to work. 

Benefits won’t pay your mortgage; what they will pay after a certain amount of time is is the interest on the mortgage whereas if you’re renting benefits would count towards the rent (depending on how much your rent is obviously.)