Is there a mortgage that my friends can use to move without needing help from their daughter?

Q My friends retired on the coast 20 years ago. They are now in their 80s and want to return to live near their daughter and two sons to benefit from their care. The current problem is that on the coast they may sell for £400,000, while houses in the countryside near their family are around £500,000. Their daughter is struggling with decisions about how she can help. Can he take out a mortgage (the house he actually owns is about £440,000) on his house or take out an unsecured loan to cover his parents’ bankruptcy? Can my friends get some kind of loan, or equity exemption or interest-only products that they can manage with a small pension? How can my friends make sure their daughter is reimbursed if she dies or has to pay nursing home bills?

A Judging by the number of emails I’ve received over the years from siblings (of many) who are helping out financially with their parents or vice versa, unless all of the planning is done out of the blue and together with all the fans involved, it’s easy for things to get messy. , not only pain and anger. And any order that requires repayment by the donor – in this case, your friends daughter – (even if later) can be added and no need for distractions.

So the answer to your question if there is a product that can be used by your friends without getting help from their children, yes, there is. According to Andy Vickery, a qualified advertising and mortgage advisor at Money Release who specializes in money over 55 years old, they can take out a similar mortgage. He says: “The cash from your current property, plus the money you put down on the new home (using an equity-corrected mortgage), will be enough to buy your new home.”

So, use the money advertised “free equity to buy property” calculatorand suppose your friends have £365,000 to put down as savings but the minimum is 88 (after deducting – from the £400,000 sale – member of land and legal fees as well as £25,000 they have to pay in. stamp duty on the new property worth £500,000), they need a mortgage raised equity of £135,000 to complete the sale.

The advantage of a joint amortization mortgage over a traditional residential mortgage, such as the type a daughter can take out, is that there are no monthly payments to be made. It does not mean that the interest is not paid – but the interest must be added to the amount originally borrowed, so the amount of debt increases each year. If your friends’ pensions allow them to pay a little more interest – whether it’s normal or feel like it – the amount of debt will slow down.

Whatever your friends choose, Vickery says it should only be a libertarian program approved by the Libertarian Council.

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