Coming up to retirement with mortgage issues - Homewise thoughts ?

susanbythesea1

Hi all, I'm after some suggestions or advice, I currently live in a semi-detached house by the sea which I plan to move from, I have an interest only mortgage with £95k left to pay, I work part time currently but am looking to retire in a years time at 66+, my plan was to sell up and purchase a small bungalow repaying the outstanding mortgage however the budget for this is really too small and i am struggling to sell my house as its very unusual so most buyers are looking for something less individual, 
i recently thought, like many, i am trying to do this to leave money to my only son , i am divorced and have no one else i feel needs money, my son was left money by my mother and has been able to buy a house, albeit a lowish value one outright, he is also likely to be left a reasonably large sum by another relative
I would like to look at the options for buying a property thro Homewise or similar, does anyone have any advice or thoughts about this ? 

missile

How much is your house valued at and how much is the one you intend to buy? After you pay off the mortgage, estate agents, solicitors, et al I doubt you will save any money.
Good luck

Savvy_Sue

What's your pension income likely to be? Finding a good mortgage advisor might help you afford what you need: some lenders are more open to older borrowers than they used to be. 

Nebulous2

There is a lot happening there, much of it depending on selling your house. 

When does the interest only mortgage end?

The lender will expect their money back then, and there are no guarantees they will extend the term. 

Organgrinder

I've no experience of schemes like this, however my view is that no-one offers this out of the goodness of their heart, they do it to make money.

It's potentially much like the Carol Vorderman ads where the small print can look horrifying.

My advice would be to fully cost everything. Look at various scenarios eg a quick sale, staying put even (possibly asking son if he could afford the interest - it may be a sound investment for him), take in a lodger, etc etc.

Whatever you do, do so with your eyes wide open. I hope it all works out for you.

SandyShores

Agree with organgrinder have a good think about the different options and scenarios.  I know Nationwide were offering mortgages up to 85 years old (as long as 60% or less of value) so with a lodger you might find its do-able.  

If you still prefer to move, have a look into the government discount or shared ownership options.  With the discount schemes you purchase a property at around 80% of its value, but when you eventually sell it is also sold at 80% of market value.  Shared ownership means you pay rent on the bit you don't own - there are some older person's schemes.  If you can find something suitable for you beware that the rents vary between providers so I would recommend looking at the different one to make sure its a reasonable one.

https://www.sharetobuy.com/guides-and-faqs/government-buying-and-rental-schemes/

susanbythesea1

missile said:

How much is your house valued at and how much is the one you intend to buy? After you pay off the mortgage, estate agents, solicitors, et al I doubt you will save any money.
Good luck

Currently I intend to pay off the mortgage and purchase cash free, however the property options I am able to buy to achieve this are diminishing in this area, I have enough in savings to pay all the bills related to moving, fees stamp duty etc... I just dont have enough to purchase a home in an area I like and feel safe in 

susanbythesea1

Savvy_Sue said:

What's your pension income likely to be? Finding a good mortgage advisor might help you afford what you need: some lenders are more open to older borrowers than they used to be. 

My pension will be fairly low, but along with my state pension I will be fine as long as I do not have a mortgage I need to pay.

susanbythesea1

Nebulous2 said:

There is a lot happening there, much of it depending on selling your house. 

When does the interest only mortgage end?

The lender will expect their money back then, and there are no guarantees they will extend the term. 

My interest only mortgage has another 18mths to run hence my wish to make a decision now

susanbythesea1

SandyShores said:

Agree with organgrinder have a good think about the different options and scenarios.  I know Nationwide were offering mortgages up to 85 years old (as long as 60% or less of value) so with a lodger you might find its do-able.  

If you still prefer to move, have a look into the government discount or shared ownership options.  With the discount schemes you purchase a property at around 80% of its value, but when you eventually sell it is also sold at 80% of market value.  Shared ownership means you pay rent on the bit you don't own - there are some older person's schemes.  If you can find something suitable for you beware that the rents vary between providers so I would recommend looking at the different one to make sure its a reasonable one.

https://www.sharetobuy.com/guides-and-faqs/government-buying-and-rental-schemes/

Thank you for this link, I am specifically looking for a bungalow which does not seem to be an option thro this scheme currently but I will investigate more 

SandyShores

susanbythesea1 said:

Thank you for this link, I am specifically looking for a bungalow which does not seem to be an option thro this scheme currently but I will investigate more 

Yes, I think bungalows will be more difficult to come by.  I had a look at a couple of different areas and did find a few - so there are some out there, but it all depends on where you are looking to buy and whether any are being built or become available - here's what I found for examples: Share to buy Bunglalow Share to buy Bungalows.  You can set up a search with an alert to let you know when any in your area become available here but I think there are other searches and associations out there so definitely worth investigating.

Good luck with it all.