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  • FIRST POST
    • Heatherrose
    • By Heatherrose 11th Apr 18, 8:22 AM
    • 2Posts
    • 0Thanks
    Heatherrose
    Equity release charge to end contract 100000
    • #1
    • 11th Apr 18, 8:22 AM
    Equity release charge to end contract 100000 11th Apr 18 at 8:22 AM
    Hi my mum took out an equity release mortgage in 2000 without my knowledge when my dad was terminally ill for 80000. She now wants to downsize as is unable to look after the property and pay off the equity loan she is now 75. The company have said the equity to pay back is now 400000 and the redemption fee is 100,000! Can they legally charge this much to end the agreement thank you
Page 1
    • Edi81
    • By Edi81 11th Apr 18, 8:38 AM
    • 450 Posts
    • 309 Thanks
    Edi81
    • #2
    • 11th Apr 18, 8:38 AM
    • #2
    • 11th Apr 18, 8:38 AM
    Yes. It would have been in the original documentation.

    Did your mum get advice before taking it out?
    • ACG
    • By ACG 11th Apr 18, 9:04 AM
    • 16,816 Posts
    • 8,771 Thanks
    ACG
    • #3
    • 11th Apr 18, 9:04 AM
    • #3
    • 11th Apr 18, 9:04 AM
    Has your mum got the paperwork from when the mortgage was taken out?
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • TrickyDicky101
    • By TrickyDicky101 11th Apr 18, 9:36 AM
    • 3,004 Posts
    • 1,942 Thanks
    TrickyDicky101
    • #4
    • 11th Apr 18, 9:36 AM
    • #4
    • 11th Apr 18, 9:36 AM
    What's the nature of the equity release? Is it an actual 'lifetime mortgage' (ie a loan) of some description or was it a 'home reversion' - whereby your Mum would have sold a portion of the property?

    You really need to see the original documentation to check what the terms were.
    • getmore4less
    • By getmore4less 11th Apr 18, 2:13 PM
    • 32,035 Posts
    • 19,222 Thanks
    getmore4less
    • #5
    • 11th Apr 18, 2:13 PM
    • #5
    • 11th Apr 18, 2:13 PM
    80k to 400k (interest rolling up) in 17 years is around 9.5%
    what's the house worth?
    • lisyloo
    • By lisyloo 11th Apr 18, 2:16 PM
    • 21,832 Posts
    • 10,546 Thanks
    lisyloo
    • #6
    • 11th Apr 18, 2:16 PM
    • #6
    • 11th Apr 18, 2:16 PM
    We looked at this in 2002/2003 (and didn't go ahead).
    There was provision in the contract for moving property.
    Is there any provision in the contract for moving as opposed to ending the agreement?
    • Thrugelmir
    • By Thrugelmir 11th Apr 18, 5:24 PM
    • 58,442 Posts
    • 51,814 Thanks
    Thrugelmir
    • #7
    • 11th Apr 18, 5:24 PM
    • #7
    • 11th Apr 18, 5:24 PM
    without my knowledge
    Originally posted by Heatherrose
    Parents are able to make decisions for themselves.
    Financial disasters happen when the last person who can remember what went wrong last time has left the building.
    • Brynsam
    • By Brynsam 11th Apr 18, 6:42 PM
    • 916 Posts
    • 602 Thanks
    Brynsam
    • #8
    • 11th Apr 18, 6:42 PM
    • #8
    • 11th Apr 18, 6:42 PM
    Hi my mum took out an equity release mortgage in 2000 without my knowledge when my dad was terminally ill for 80000. She now wants to downsize as is unable to look after the property and pay off the equity loan she is now 75. The company have said the equity to pay back is now 400000 and the redemption fee is 100,000! Can they legally charge this much to end the agreement thank you
    Originally posted by Heatherrose
    Why have the figures changed so dramatically from those you gave in your other post on this topic:

    Hi my mum has an equity release agreement but now wants to sell her house and pay off the redemption fee after 15 years - she is 75 The equity company say she now owes 350000 (original loan was 80000) but to end the agreement early want her to
    Pay an additional 150, 000! Is this normal ? And is it legal ? Thanks

    Have you checked the paperwork to check what the actual position is - that's the starting point.
    • TadleyBaggie
    • By TadleyBaggie 11th Apr 18, 6:45 PM
    • 2,739 Posts
    • 2,076 Thanks
    TadleyBaggie
    • #9
    • 11th Apr 18, 6:45 PM
    • #9
    • 11th Apr 18, 6:45 PM
    I think the numbers are just made up and were pure guesswork. Get hold of the original paperwork and find out what the agreement was.
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