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06-03-2020, 05:30 PM
21

Re: equity from your house

Originally Posted by realspeed ->
LQ

If you think about it and use the money to improve your home to make it worth more, that means they can claim more on death on money you borrowed from them in the first place
Exactly!!!
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06-03-2020, 06:59 PM
22

Re: equity from your house

Originally Posted by Aerolor ->
Yes, it's a win win situation for the equity release companies. The adverts saying improve your home with the money they "lend" really annoy me - it's a con. Unless a person absolutely has to I would not touch equity release with a barge pole either. Better to get a smaller amount with a bank loan IMO.
But a bank loan has to be paid back, with interest, sooner rather than later - not viable for those with insufficient disposable income .....
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06-03-2020, 07:00 PM
23

Re: equity from your house

Originally Posted by Aerolor ->
Exactly!!!
But you'll be dead so why care .....
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06-03-2020, 07:04 PM
24

Re: equity from your house

Originally Posted by Aerolor ->
But there is quite a cost to the owner. The equity release companies not only gain from the loan -they also gain when a person uses the money to maintain or enhance the value of their own home. As I said before, a win, win situation for them all round.
If the owner is not planning to move then there is no cost to the owner until death (or, perhaps, being taken into care) intervenes.
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06-03-2020, 07:06 PM
25

Re: equity from your house

Originally Posted by realspeed ->

If you think about it and use the money to improve your home to make it worth more, that means they can claim more on death on money you borrowed from them in the first place
I understand the above in theory, but am I right in thinking ...

... this so called loan is money gained from the sale of a percentage of your property. If your property is worth more when you die then that percentage is more. Fair enough.

And yes, OK, for them to encourage you to spend £ on improvements sounds a little sneaky. Therefore Equity Release is better spent on something else - a holiday home? Unless you just want, say, a new wetroom in your dying days, which may not make a significant impact on the property value ... so bugger it.
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06-03-2020, 07:29 PM
26

Re: equity from your house

I took the advice of a financial adviser once and bought a endowment mortgage,that didn't turn out well,my advice if its looks too good to be true it is.
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06-03-2020, 07:34 PM
27

Re: equity from your house

I would not trust a financial adviser as far as I could throw them. They are paid by whatever company is employing them so they get a rake off.

They are just gloryfied sales people disguised under a different name.
Don't get conned by them.

Banks often use them to drive business their way
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06-03-2020, 08:21 PM
28

Re: equity from your house

Originally Posted by Omah ->
But a bank loan has to be paid back, with interest, sooner rather than later - not viable for those with insufficient disposable income .....
Maybe,but I believe it is possible for many older folks to get a small mortgage against the collateral in their home. A mortgage would be no where as costly as equity release as far as I know.
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06-03-2020, 08:23 PM
29

Re: equity from your house

Originally Posted by Omah ->
But you'll be dead so why care .....
Most people have someone to leave their assets to and if not far better IMO to leave it to a charity where it would do some good rather than let the equity loansharks get their hands on the hard earned asset that is a property.
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06-03-2020, 08:27 PM
30

Re: equity from your house

My neighbour took out equity release a couple of times . I know one amount was £30 k the other amount I'm unsure of . When she died hubby stayed in the house when he died the company took control of the house . The sons were given 1 month to empty the house . Of course I didnt know what was happening but when I asked one of the sons was he going to rent out the house he replied
We cant afford it , equity own most of it .

The house was sold quickly and cheaply.

I can only gather that the interest on the property was huge. I'm also told it's a rolling daily interest rate.

Leave well alone I say

But raising cash to keep your property in a decent state is a worry for people with little savings
 
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