Equity Release

[paoloh]

Quick description of situation:

A friends Mum has a house worth approx £180k

Owes £69k

Wants to release equity or sell but carry on living paying rent.

Best offer so far is £140k minus mortgage and rent of £850.

Can any of you guys do any better?

[GreatGranny]

To do this in the present climate is financial suicide IMO.

So basically they will buy her house for £40k below market value and still charge £850 a month rental which will leave her with £71k in the bank.

A mortgage for £69k over say 10 years will cost less than £850 if she can get a mortgage.

Or she will have to sell and downsize, whats keeping her in the house, hope it isn't for sentimental reasons like my parents who are sitting on £300k and say they find it difficult to pay the bills every month.

[paoloh]

GreatGranny said:

To do this in the present climate is financial suicide IMO.

So basically they will buy her house for £40k below market value and still charge £850 a month rental which will leave her with £71k in the bank.

A mortgage for £69k over say 10 years will cost less than £850 if she can get a mortgage.

Or she will have to sell and downsize, whats keeping her in the house, hope it isn't for sentimental reasons like my parents who are sitting on £300k and say they find it difficult to pay the bills every month.

She has lived in the house all her life....
She already has a mortgage for £69k, she wants to free up her equity so that she can have some quality of life.

[Jasper Gilder]

She could get a better deal by renting her own house out and using the payments to cover mortgage and rent on a smaller place. She wouldn't come out worse than she is now

[paoloh]

Jasper Gilder said:

She could get a better deal by renting her own house out and using the payments to cover mortgage and rent on a smaller place. She wouldn't come out worse than she is now

But that would not release any equity

[Eric Mc]

Why does she need to release equity?

[paoloh]

Eric Mc said:

Why does she need to release equity?

Wants to give £30k to her son and actually get to see him enjoy it and the other oney would be to improve her quality of life. This is what I am being told.