Can I help my mum and dad?

mummytofour

Hiya,
Well I was lookig at a buy-to-let but i have changed my mind for now, at least.
I have just found out that my parents are really really worried.
The situation the best i know it is, my dad is 59, worked for 40 years in the same job and took early retirement due to stree.
He now works as a cleaner and with all the income he has (pension and cleaning) around 18k coming in.
He has aprox 43k out standing on the mortgage and the house is worth aprox 180k maybe a little more.
Now my dad is finding it hard working full time as a cleaner, he is not in the best health now and my mum cant work due to ill health.
The mortgage has 10 years left to go, but i think thats too long, my dad will not be able to afford it when he is not working and i dont think he can be working until he is 69.
I live in a shared ownership house with a mortgage of 67k.
Would it be possible for me to help my parents? maybe take over their mortgage? they are paying in the region of £330 pcm which is a mixture of repayment and endowment, my mum says she does not think that the endowmnet will, pay out enough anyway, she says it is supposed to pay out 17k plus they are paying 10k on repayment so that leaves them a short fall of 16k in ten years time.

Im not sure that they want me to take over the mortgage, if i did i could not afford to pay it at £330 pcm it would need to be a repayment mortage over a 25 yr term for me to be able to afford it.

Anyway i know its all veage, but i really would be glad if i could have some advise.
Thanks so much
Vxx

sleepless_saver

They must be worried and of course you want to help but I remember seeing from another thread that you were wanting to move somewhere bigger but would have a problem with the extra mortgage. So the big questions is -
do you think it is manageable to pay an additional mortgage for 25 years when your children are growing up and getting steadily more expensive _pale_ ? My guess is that your parents would hate to see you spend money on them at the expense of their grandchildren.

There are other options for your parents to think about. Was the endowment missold, would it be better surrendering it and reducing the outstanding amount, are they on the best mortgage deal, can they rent a room out, can they sell and buy somewhere slightly cheaper, would a home reversion plan be an option (possibly not because of their ages), is your mother getting any disability benefits she is entitled to and so on.

hope this helps

mummytofour

Awww thanks i see your point...
I guess its all really complicated and maybe at the back of my mind i wonder if maybe i could help them and me in the long run, but im not sure how or what!
I just dont want to see them worry for the sake of a few k, coz for me i have another 35 plus years to be able to pay on a mortgage, for my folks they need shot of it asap.
On top of this tho, they have helpped me in the past and i would like to help them, im just not sure how i can.
Yep my mum is getting all her benefits and they were not missold the endowment, well so im assured by my parents anyway.

The area we live in is sooo expensive there is not really anything cheaper in the area and they dont want to move from what they know with both of them getting less able and older.
Alas rent a room would not be an option with my mothers health problems.

I guess i need to work out a way for them to pay of this mortgage quicker...then i will look at them getting a better rate as that will be a start, also i need to look at the endowment i feel to see where that is headed.
Vxx

EdInvestor

Hi mummy to four

they were not missold the endowment

Try this website for misselling grounds for complaint:

https://www.endowmentaction.co.uk

On the list is being sold an endowment which stretches into retirement.

Equity release/home reversion is one way they could consider of getting rid of some of the mortgage later.

But they will probably be better to rejig the existing mortgage for the moment.Helpfully, interest rates look like coming down.Post some details of the endowment so we can see what to do with it.

Company it's with
Guaranteed sum assured
Total bonuses
Surrender value
Monthly premium
Maturity date

sleepless_saver

mummytofour wrote:

Awww thanks i see your point...
I guess its all really complicated and maybe at the back of my mind i wonder if maybe i could help them and me in the long run, but im not sure how or what!
I just dont want to see them worry for the sake of a few k, coz for me i have another 35 plus years to be able to pay on a mortgage, for my folks they need shot of it asap.

Vxx

I so understand that. It just sounds like it would be a struggle and would have an impact on your children and/or your own financial security when you get older. If you took out a repayment mortgage for £20k at 5% that would cost you £116 per month, which over 25 years would mean that you'd pay out £35000:eek: . It would probably make slightly more sense to give them the money to overpay the mortgage.

Think about this too. If one of your parents had to go into residential care following the death of the other, then the costs of that would need to be met from assets i.e. house. So paying towards their mortage, although I understand this isn't why you're thinking about doing it, is not a safe investment as you may not get much back.