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Equity release


elvis
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Anyone considered this by any chance? 

Having never worked for a firm offering a pension plan , I find myself at 54 with no personal pension ( I know ) 

On the other hand , we are fortunate to have a lot of equity in the house we own. My wife has an NHS pension , so she'll be ok assuming we're not divorced before then that is.

I've always thought of equity release as a bit dodgy , is it?

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Back in the day I did a lot of equity release stuff. 

 

My OPINION* - I wouldn't go anywhere near it. Yes it is dodgy, the terms are preposterously loaded in favour of the lender and incredibly punitive. If your circumstances change you can find yourself totally fucked, and whatever inheritance your offspring or dependents are entitled to can be swallowed whole. 

 

* DISCLAIMER.  THIS IS NOT PROFESSIONAL ADVICE. I URGE YOU TO SEEK INDEPENDENT FINANCIAL ADVICE AWAY FROM THIS CESSPOOL. 

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13 minutes ago, elvis said:

Anyone considered this by any chance? 

Having never worked for a firm offering a pension plan , I find myself at 54 with no personal pension ( I know ) 

On the other hand , we are fortunate to have a lot of equity in the house we own. My wife has an NHS pension , so she'll be ok assuming we're not divorced before then that is.

I've always thought of equity release as a bit dodgy , is it?

I am not an FA but any debt that compounds interest instead of paying it is ruinously expensive in the long term. It depends if you care about leaving a big inheritance for your kids as they will be the ones paying the massive accrued interest. I would steer clear until much later in life. 

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30 minutes ago, TK-421 said:

Back in the day I did a lot of equity release stuff. 

 

My OPINION* - I wouldn't go anywhere near it. Yes it is dodgy, the terms are preposterously loaded in favour of the lender and incredibly punitive. If your circumstances change you can find yourself totally fucked, and whatever inheritance your offspring or dependents are entitled to can be swallowed whole. 

 

* DISCLAIMER.  THIS IS NOT PROFESSIONAL ADVICE. I URGE YOU TO SEEK INDEPENDENT FINANCIAL ADVICE AWAY FROM THIS CESSPOOL. 

Fair enough

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My mate has a fair bit of equity and decided to get a mortgage and buy a place in France. He went on House in the Sun last November, they found him a property and hes now bought it (episode being shown in March/April). In a year or 2 he will sell his house in the UK, pay the mortgage off, buy a smaller one and flip between the 2.

 

If you are lucky enough to own your house and have quite a lot of equity, buying another one could prove profitable.

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2 hours ago, elvis said:

Anyone considered this by any chance? 

Having never worked for a firm offering a pension plan , I find myself at 54 with no personal pension ( I know ) 

On the other hand , we are fortunate to have a lot of equity in the house we own. My wife has an NHS pension , so she'll be ok assuming we're not divorced before then that is.

I've always thought of equity release as a bit dodgy , is it?

Be very careful with Equity Release as the wrong one can be disasterous. Was talking with the financial advisor who looks after our stocks and shares ISAs and he told me use your savings first before ER and he used to sell ER products!

 

If you've been working most of your life, you should still have paid or been credited NI contributions. Take a look via the Government Gateway what your state pension forecast might be. Yes, it's years away but may help in making a decision.

 

Your wife's NHS pension should be inflation proofed when she draws it and she can do this from age 60, I think. She'll also get a State Pension although this will be reduced if she was 'contracted out' for any period of her NHS career.

 

Downsizing only works if you have a decent house in a large, desirable location and are prepared to live in a smaller house somewhere less desirable in my humble opinion.

 

If your house is worth 300k or under, imagine what type of gaff you'd have to live in and where if you want to come out with at least 50k capital.

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