pensioner loan

Mystivo

Hi, need advice..I need to take out a loan for £20,000.00. I am 69 years old, a home owner (No mortgage) Property value £400,000.00 . Am on a gov pension & work part time 2 days per week. What is the best option? 

tacpot12

How much can you afford to repay each month? Do you have any problems with your credit rating?

Mark_d

I honestly believe you would struggle to get a loan anywhere near as big as £20k.  If you need to raise that kind of money then maybe downsizing is you best option

Ayr_Rage

Mystivo said:

Hi, need advice..I need to take out a loan for £20,000.00. I am 69 years old, a home owner (No mortgage) Property value £400,000.00 . Am on a gov pension & work part time 2 days per week. What is the best option? 

Do you mean the State Pension or another pension?

What is your combined annual income from all pensions and work?

Mystivo

My credit rating is good....can't afford monthly repayments as on low income,  but hoping there is a better way than equity release

Mark_d

Mystivo said:

My credit rating is good....can't afford monthly repayments as on low income,  but hoping there is a better way than equity release

The £20k has to come from somewhere.  You can take £20k out of the equity in your home by downsizing or equity release/lifetime mortgage.  Maybe you can borrow it from friends/family.  Maybe you can sell other assets?  Do you really need to raise £20k or might there be other ways of achieving the same objective?

CliveOfIndia

Mystivo said:

can't afford monthly repayments as on low income

If you can't afford to make monthly repayments, how are you planning on repaying a loan - even assuming you'd be given one?

Mystivo said:

but hoping there is a better way than equity release

Equity release is generally a bad idea for most people.  Downsizing would appear, on the face of it, to be the most prudent option.  But what do you need the money for?  Depending on the reason, there may be other alternative approaches.

Keep_pedalling

CliveOfIndia said:

Mystivo said:

can't afford monthly repayments as on low income

If you can't afford to make monthly repayments, how are you planning on repaying a loan - even assuming you'd be given one?

Mystivo said:

but hoping there is a better way than equity release

Equity release is generally a bad idea for most people.  Downsizing would appear, on the face of it, to be the most prudent option.  But what do you need the money for?  Depending on the reason, there may be other alternative approaches.

ER is not usually a bad idea for the person taking the loan. If the OP has no direct descendants to leave his estate to then taking as much equity as possible through ER would be a very good idea. Even if they have direct descendants, what is more important living out your latter days in comfort or maximising your children’s inheritance? 

Exodi

The rate for a loan like that would be at least 6% (if you were the ideal candidate).

Over a 5 year repayment window, that could be a monthly payment of minimum £385 and at least £3k in interest.

In reality I can't imagine many lenders would be willing to lend you 20 grand. What do you need it for? You will need to tell them this.

Mystivo said:

My credit rating is good....can't afford monthly repayments as on low income,  but hoping there is a better way than equity release

Sorry you've lost me - I can't understand what you're after then... A loan that you don't have to pay back? If only!

If you're not willing to release equity in your property (I wouldn't either unless you had no-one to bequeath your assets to), the other alternative to access that sort of cash would be downsizing (unless you have any private pension provision)?

What do you need the money for? I suspect it's not just a new car or home improvements as you've said you "need" to take out a loan for £20k. Hopefully it's also not to give to someone who's assured you they can invest your money for you and guarantee you'll get tenfold back - we hear a lot of that unfortunately.

Think very carefully about this.

MEM62

Mystivo said:

My credit rating is good....can't afford monthly repayments as on low income,  but hoping there is a better way than equity release

If you cannot afford repayments how are you expecting someone to 'lend' you money that you cannot pay back?  I agree with others that equity release is a poor product in almost all circumstances.  Why not share with us the reason for needing the money as there may be other alternatives.