Any mortgage brokers or equity release bods in the Club?

[Herbie]

1 hour ago, KeindeAbiola said:

I'm not a mortgage broker, but I can offer some friendly advice. Given your situation, it's worth exploring options like a mortgage or equity release. Although you're retired, eligibility for a mortgage could still be possible depending on your income and other factors. Equity release is designed for retirees and allows you to unlock the value in your home. As for buying a £265k property and releasing £50k equity, it's best to consult with a mortgage broker or equity release specialist to see if that's feasible. They can guide you through the process and help you find the best solution for your needs. I know these financial decisions can be overwhelming, but remember, you're not alone. By the way, I recently came across a Mortgage Broker in Swansea that offers helpful info on mortgages and loans.

Thanks mate but we're all sorted now, or will be within the next four weeks.

We found a brilliant bungalow, we had an equity release mortgage all set up and ready to go - and then because the property was empty at Christmas and we had that really cold snap, one of the pipes burst and wasn't discovered for about three days.

The seller's insurance company are dealing with the repairs and the builders have a contractual deadline to complete the works no later than 9th June, so hopefully we'll be able to move in within a couple of weeks of that date.

[GMB]

I think equity release is a big mistake. 😟

You lose control over your future living. 

What about this Gov't scheme: 

https://www.ownyourhome.gov.uk/scheme/opso/

OPSO is a form of Shared Ownership available to people aged 55 and over. It allows you to buy an initial share in a OPSO home and pay rent on the remaining share.

OPSO homes delivered through the new model of Shared Ownership will enable you to buy an initial share in your OPSO home of between 10% and 75% of its market value. Under the previous model of Shared Ownership, the minimum initial share you can buy in your OPSO home is 25% of its market value.

OPSO works in the same way as the general shared ownership scheme, but you can only buy up to 75% of your home. Once you own 75% you won’t have to pay rent on the remaining share.

 

You may be able to buy a home through OPSO if you’re aged 55 or over and meet the following criteria: 

• your gross annual household income is £80,000 or less outside London, or your household earns £90,000 or less in London
• you are a first-time buyer, you used to own a home but can’t afford to buy one now or are an existing shared owner looking to move.

Find out how to apply for Older Persons Shared Ownership (OPSO)   (GOV.UK). 

[Boomer54]

On 10/17/2022 at 10:59 PM, Herbie said:

Cheers Steve 

Zep are my favourite band (Zep IV being my favourite album ever) and they just can't be enjoyed to the full without the volume being wound up 

Cracking choice, but have you tried some of early albums from Alterbridge. I didn't think anybody might match Plant until I heard Kennedy live at the Albert hall ....outstanding range for any musical genre .

[Herbie]

5 hours ago, GMB said:

I think equity release is a big mistake. 😟

You lose control over your future living. 

What about this Gov't scheme: 

https://www.ownyourhome.gov.uk/scheme/opso/

OPSO is a form of Shared Ownership available to people aged 55 and over. It allows you to buy an initial share in a OPSO home and pay rent on the remaining share.

 

I agree that Equity Release isn't for everyone, far from it, but for us it was a no-brainer. If you have kids or someone else that you want to leave a legacy to then it definitely isn't right for you, but it's perfect for us and I'll try to explain why.

We'll both be 66 in January and the mortgage term is 23 years, which would make us 89 at the end of the mortgage. With the greatest will in the world we can't see either of us reaching that age but even if we are still around, we can continue to live in this bungalow. They only get their money back when the last one of us dies or moves into long-term care.

You can choose one of three ways to pay the mortgage:

• Pay both interest and capital like an ordinary mortgage
• Pay interest only
• Pay nothing at all

We borrowed £70k and took the third option, ie, to pay nothing. If it runs to term then that £70k that we borrowed will have grown to about £264k that we owe them. As mentioned earlier, they only get paid when the last one of us dies or goes into long-term care. If we happen to live longer then we have the legal right to stay in the property until we die/move out.

There is a guaranteed 'no negative equity' clause which means if the property that we paid £300k for drops in value, the mortgage provider will never chase our estate to make up the difference. They take a gamble and they may win or they may lose.

Just as an example for this illustration, let's say that we "should" be paying back £300/month - but we aren't. Instead, we're putting that money into our bank account so that we can get it out as and when we want it, to spend it on whatever we wish.

It's just a way of liquidating some value out of a £300k lump of bricks and mortar. We have no kids and although we do have family, they're all financially stable and independent so they neither want, nor need any inheritance from us and if we didn't do this it woud be a case of the Cats Home or the Government getting all of it.

Anyway, it's all moot for us now because we did it and we got the keys about two months ago (sorry @Phil xxkr I forgot to tell you)

As I said, ER isn't for everyone but for us, I really can't see a downside.

[Herbie]

1 hour ago, Boomer54 said:

Cracking choice, but have you tried some of early albums from Alterbridge. I didn't think anybody might match Plant until I heard Kennedy live at the Albert hall ....outstanding range for any musical genre .

No I haven't Steve - but I will be now, thanks

[Boomer54]

9 minutes ago, Herbie said:

I agree that Equity Release isn't for everyone, far from it, but for us it was a no-brainer. If you have kids or someone else that you want to leave a legacy to then it definitely isn't right for you, but it's perfect for us and I'll try to explain why.

We'll both be 66 in January and the mortgage term is 23 years, which would make us 89 at the end of the mortgage. With the greatest will in the world we can't see either of us reaching that age but even if we are still around, we can continue to live in this bungalow. They only get their money back when the last one of us dies or moves into long-term care.

You can choose one of three ways to pay the mortgage:

• Pay both interest and capital like an ordinary mortgage
• Pay interest only
• Pay nothing at all

We borrowed £70k and took the third option, ie, to pay nothing. If it runs to term then that £70k that we borrowed will have grown to about £264k that we owe them. As mentioned earlier, they only get paid when the last one of us dies or goes into long-term care. If we happen to live longer then we have the legal right to stay in the property until we die/move out.

There is a guaranteed 'no negative equity' clause which means if the property that we paid £300k for drops in value, the mortgage provider will never chase our estate to make up the difference. They take a gamble and they may win or they may lose.

Just as an example for this illustration, let's say that we "should" be paying back £300/month - but we aren't. Instead, we're putting that money into our bank account so that we can get it out as and when we want it, to spend it on whatever we wish.

It's just a way of liquidating some value out of a £300k lump of bricks and mortar. We have no kids and although we do have family, they're all financially stable and independent so they neither want, nor need any inheritance from us and if we didn't do this it woud be a case of the Cats Home or the Government getting all of it.

Anyway, it's all moot for us now because we did it and we got the keys about two months ago (sorry @Phil xxkr I forgot to tell you)

As I said, ER isn't for everyone but for us, I really can't see a downside.

Thats' an excellent summary Herbie. In effect you are meeting your living needs (mobility) and pairing that with the ability to pull forward your capital turning it effectively into income. Given your circumstance I would say that is goal achieved.

[Boomer54]

32 minutes ago, Herbie said:

No I haven't Steve - but I will be now, thanks

👍 I may be a died in the wool Northern Soul lad, but I also really like rock ,and instrumentally ,early prog rock ,but needs to be turned up, right.

Recommended, Alterbridge albums ABIII and Blackbird as starters to try out.

On a roll, think you might also like Rival Sons , Album choice ,Great Western Valkyrie !

[LenT]

2 hours ago, Herbie said:

Anyway, it's all moot for us now because we did it and we got the keys about two months ago (sorry @Phil xxkr I forgot to tell you)

As I said, ER isn't for everyone but for us, I really can't see a downside.

I can’t see a downside for you either, Herbs!
I wish you both every happiness in your new Home for many years to come.

[Frank the Hornet]

Herbie,

Absolutely feel your other half & yourself have made exactly the correct decision and your factual description of the reasons Equity Release is right for you both bears this out.

All the very best for the future to you both.

[Phil xxkr]

19 hours ago, Herbie said:

I agree that Equity Release isn't for everyone, far from it, but for us it was a no-brainer. If you have kids or someone else that you want to leave a legacy to then it definitely isn't right for you, but it's perfect for us and I'll try to explain why.

We'll both be 66 in January and the mortgage term is 23 years, which would make us 89 at the end of the mortgage. With the greatest will in the world we can't see either of us reaching that age but even if we are still around, we can continue to live in this bungalow. They only get their money back when the last one of us dies or moves into long-term care.

You can choose one of three ways to pay the mortgage:

• Pay both interest and capital like an ordinary mortgage
• Pay interest only
• Pay nothing at all

We borrowed £70k and took the third option, ie, to pay nothing. If it runs to term then that £70k that we borrowed will have grown to about £264k that we owe them. As mentioned earlier, they only get paid when the last one of us dies or goes into long-term care. If we happen to live longer then we have the legal right to stay in the property until we die/move out.

There is a guaranteed 'no negative equity' clause which means if the property that we paid £300k for drops in value, the mortgage provider will never chase our estate to make up the difference. They take a gamble and they may win or they may lose.

Just as an example for this illustration, let's say that we "should" be paying back £300/month - but we aren't. Instead, we're putting that money into our bank account so that we can get it out as and when we want it, to spend it on whatever we wish.

It's just a way of liquidating some value out of a £300k lump of bricks and mortar. We have no kids and although we do have family, they're all financially stable and independent so they neither want, nor need any inheritance from us and if we didn't do this it woud be a case of the Cats Home or the Government getting all of it.

Anyway, it's all moot for us now because we did it and we got the keys about two months ago (sorry @Phil xxkr I forgot to tell you)

As I said, ER isn't for everyone but for us, I really can't see a downside.

Well done Herbs, I am sure you and your wife are well content with the situation and free of any money worries. There are lots of things to worry about when you get older and money shouldn't be one of them. And don't forget you still own 100% of your home and when you come up on the Pools or Lottery you can sort out the balance.😎 I personally am deeply invested in Premium Bonds which are luckily showing me a double digit return. 

[GMB]

22 hours ago, Herbie said:

We'll both be 66 in January and the mortgage term is 23 years, which would make us 89 at the end of the mortgage. With the greatest will in the world we can't see either of us reaching that age but even if we are still around, we can continue to live in this bungalow. They only get their money back when the last one of us dies or moves into long-term care.

You may well still be here after 23 years. God willing, you will be. You never know. But situations can change and you may want to move or have some kind of lifestyle change.

All that expensive interest building up  " We borrowed £70k and took the third option, ie, to pay nothing. If it runs to term then that £70k that we borrowed will have grown to about £264k that we owe them"

That hit of up to £264K will put a big dent in your freedom of choice in the future. You may even want to go and live in Portugal in your "golden years" based on the mess that is happening in the UK.

They make a ton of money out of you and can afford to pay third rate "celebs" to sell the policies.

Anyway, you have done it now so........Best of luck for the future.☺️

 

BTW I see that you live in Lancashire as we do.. It does not rain as much in Portugal.⛈️

 

[Herbie]

55 minutes ago, GMB said:

You may well still be here after 23 years. God willing, you will be. You never know. But situations can change and you may want to move or have some kind of lifestyle change...[...]...That hit of up to £264K will put a big dent in your freedom of choice in the future. You may even want to go and live in Portugal in your "golden years" based on the mess that is happening in the UK.

I know what you mean and I appreciate the thought, but that would never happen for two very big reasons:

One is my disproportionate homesickness. My wife comes from Carlisle so I moved up there to be with her. It's only 90 miles up the M6 but within two months I was desperately homesick for Preston. Not so much for the town itself because it's nothing special, but I couldn't stand losing all my friends, especially the dozen or so of us who have been meeting up a couple of times every month (at least) since leaving school in 1974. I've known these guys for 61 years, since we all walked into infant school at the age of 5.

The other big reason is our health, which is the main reason why we needed a bungalow anyway. This bungalow is everything we wanted and more besides, but by a happy accident it's also close to the hospital, supermarkets, a pub, and almost anything we'll ever need as we get older and less mobile.

We have made some silly or even bad decisions in our lives but we're both confident that this ranks amongst the best.

[Barry14UK]

Access to NHS can take on greater importance as you get into retirement.  A reason why many move back to the UK.  My wife and I moved from a house in Surrey to a bungalow in Devon to help support our younger daughter and her 3 children following the break up of her marriage.  I have since had to go back to London for specialist treatment, scans etc and check ups because there is not the capability or expertise in Devon, especially in the north of the County, a factor I didn't take int account at the time. 

With the rising cost of property in the UK, disproportionately high in the South East, I couldn't afford the cost of a property like I had in Surrey previously let alone selling up a property in Portugal and paying inflated property prices to return to the UK.

I think you have chosen very wisely with all that you have close by and being near to friends.

Hope you have a long and happy retirement in your new bungalow.

 

[Phil xxkr]

On 10/7/2023 at 2:18 PM, Herbie said:

I agree that Equity Release isn't for everyone, far from it, but for us it was a no-brainer. If you have kids or someone else that you want to leave a legacy to then it definitely isn't right for you, but it's perfect for us and I'll try to explain why.

We'll both be 66 in January and the mortgage term is 23 years, which would make us 89 at the end of the mortgage. With the greatest will in the world we can't see either of us reaching that age but even if we are still around, we can continue to live in this bungalow. They only get their money back when the last one of us dies or moves into long-term care.

You can choose one of three ways to pay the mortgage:

• Pay both interest and capital like an ordinary mortgage
• Pay interest only
• Pay nothing at all

We borrowed £70k and took the third option, ie, to pay nothing. If it runs to term then that £70k that we borrowed will have grown to about £264k that we owe them. As mentioned earlier, they only get paid when the last one of us dies or goes into long-term care. If we happen to live longer then we have the legal right to stay in the property until we die/move out.

There is a guaranteed 'no negative equity' clause which means if the property that we paid £300k for drops in value, the mortgage provider will never chase our estate to make up the difference. They take a gamble and they may win or they may lose.

Just as an example for this illustration, let's say that we "should" be paying back £300/month - but we aren't. Instead, we're putting that money into our bank account so that we can get it out as and when we want it, to spend it on whatever we wish.

It's just a way of liquidating some value out of a £300k lump of bricks and mortar. We have no kids and although we do have family, they're all financially stable and independent so they neither want, nor need any inheritance from us and if we didn't do this it woud be a case of the Cats Home or the Government getting all of it.

Anyway, it's all moot for us now because we did it and we got the keys about two months ago (sorry @Phil xxkr I forgot to tell you)

As I said, ER isn't for everyone but for us, I really can't see a downside.

Forgot to ask Herbs how does 70k grow to 264k? At interest rates at the time 70k over 25 years should be around 148k?

[Herbie]

Just now, Phil xxkr said:

Forgot to ask Herbs how does 70k grow to 264k? At interest rates at the time 70k over 25 years should be around 148k?

Ah yes, interest rates 

When I first followed your advice and got in touch with Nationwide, I think the rate was something like 2.8%; certainly under 3% anyway. Equity Release works on a lifetime interest rate, which means that whatever the rate is when you sign on the dotted line, that's the rate for the whole mortgage term.

Due to a lot of faffing about (not our fault I hasten to add) which is too long and boring to list here, we move forward in time to the point where Truss and Kwarteng destroy our economy, Nationwide pull all ER products from the market as do some others, and we end up going with Key Equity Release Group. The mortgage lender itself is a company called More 2 Life and by the time we were ready to sign on the dotted line, the interest rate was 6.8%

In the end it doesn't matter to us. It's still very affordable, we can do what we want and we can still stay here until the last one of us dies, no matter what happens to the value of the property in the meantime - but it's so damned annoying when none of the delays were down to us and knowing that we could (should) have got it cheaper.

[Boomer54]

1 hour ago, Herbie said:

Ah yes, interest rates 

When I first followed your advice and got in touch with Nationwide, I think the rate was something like 2.8%; certainly under 3% anyway. Equity Release works on a lifetime interest rate, which means that whatever the rate is when you sign on the dotted line, that's the rate for the whole mortgage term.

Due to a lot of faffing about (not our fault I hasten to add) which is too long and boring to list here, we move forward in time to the point where Truss and Kwarteng destroy our economy, Nationwide pull all ER products from the market as do some others, and we end up going with Key Equity Release Group. The mortgage lender itself is a company called More 2 Life and by the time we were ready to sign on the dotted line, the interest rate was 6.8%

In the end it doesn't matter to us. It's still very affordable, we can do what we want and we can still stay here until the last one of us dies, no matter what happens to the value of the property in the meantime - but it's so damned annoying when none of the delays were down to us and knowing that we could (should) have got it cheaper.

On the plus side Herbie I thank you for your contribution to my portfolio ! 😉

I definitely owe you a bottle of Leffe.

[GMB]

2 hours ago, Herbie said:

I know what you mean and I appreciate the thought, but that would never happen for two very big reasons:

One is my disproportionate homesickness. My wife comes from Carlisle so I moved up there to be with her. It's only 90 miles up the M6 but within two months I was desperately homesick for Preston. Not so much for the town itself because it's nothing special, but I couldn't stand losing all my friends, especially the dozen or so of us who have been meeting up a couple of times every month (at least) since leaving school in 1974. I've known these guys for 61 years, since we all walked into infant school at the age of 5.

The other big reason is our health, which is the main reason why we needed a bungalow anyway. This bungalow is everything we wanted and more besides, but by a happy accident it's also close to the hospital, supermarkets, a pub, and almost anything we'll ever need as we get older and less mobile.

We have made some silly or even bad decisions in our lives but we're both confident that this ranks amongst the best.

Wishing you all the best Herbie🍾

[Herbie]

9 minutes ago, Boomer54 said:

I definitely owe you a bottle of Leffe.

If we're going Belgian I prefer Palm Stephen, thanks

[Phil xxkr]

5 hours ago, Herbie said:

Ah yes, interest rates 

When I first followed your advice and got in touch with Nationwide, I think the rate was something like 2.8%; certainly under 3% anyway. Equity Release works on a lifetime interest rate, which means that whatever the rate is when you sign on the dotted line, that's the rate for the whole mortgage term.

Due to a lot of faffing about (not our fault I hasten to add) which is too long and boring to list here, we move forward in time to the point where Truss and Kwarteng destroy our economy, Nationwide pull all ER products from the market as do some others, and we end up going with Key Equity Release Group. The mortgage lender itself is a company called More 2 Life and by the time we were ready to sign on the dotted line, the interest rate was 6.8%

In the end it doesn't matter to us. It's still very affordable, we can do what we want and we can still stay here until the last one of us dies, no matter what happens to the value of the property in the meantime - but it's so damned annoying when none of the delays were down to us and knowing that we could (should) have got it cheaper.

Yes, great shame that Herbs but even at 6.6 over 23 interest element should be around 106?

[Herbie]

On 10/8/2023 at 9:50 PM, Phil xxkr said:

Yes, great shame that Herbs but even at 6.6 over 23 interest element should be around 106?

The problem is that it's compound interest that just keeps adding up.

If I can find the interest example they provided I'll post it here because it may help others in the future if they're thinking of doing this.

[Boomer54]

22 minutes ago, Herbie said:

The problem is that it's compound interest that just keeps adding up.

If I can find the interest example they provided I'll post it here because it may help others in the future if they're thinking of doing this.

Why Einstein Considered Compound Interest the Most Powerful Force in the Universe | Inc.com

Unfortunately Herbie, compounding is the very definition of paying nothing on what is a debt. It is the 8th wonder when you are earning it. Not so much when you are paying it.

If your equity release is framed as I think it probably is then to be honest it's irrelevant to you unless the long term effect were to see you lose your home before you die. I don't believe that is the case though so from the casket you can send it a message 'you can't take it with you, wealth, but hey ho that also applies to debt, let's hear a hallelujah'.

[MadalynMorton]

Haha, you've got quite the perspective there!

[Malc1]

Good luck with it all   We none of us know how to predict our futures ……. Not looking and that sodding bus comes along unexpectedly and “ takes you out “  ……… maybe the only certainty is a Lexus Ls400  might outlast you, me, us all 😂

Happy Retirement and screw the finance providers for all we can …… spend spend spend ….. the kids won’t need it …… if they haven’t made all they need in life by the time you, me, us reach the end of the line in our early 100’s then well that’s sad ……. They’ll be old and knackered too ……. Just like me anyway  

well done and Good Luck 

Malc 

[Boomer54]

22 minutes ago, Malc1 said:

Good luck with it all   We none of us know how to predict our futures ……. Not looking and that sodding bus comes along unexpectedly and “ takes you out “  ……… maybe the only certainty is a Lexus Ls400  might outlast you, me, us all 😂

Happy Retirement and screw the finance providers for all we can …… spend spend spend ….. the kids won’t need it …… if they haven’t made all they need in life by the time you, me, us reach the end of the line in our early 100’s then well that’s sad ……. They’ll be old and knackered too ……. Just like me anyway  

well done and Good Luck 

Malc 

I am definitely getting you booked in for some portfolio management seminars !. I do not want to be tripping over you and a begging bowl and 3 legged dog outside Waitrose.

[Malc1]

3 hours ago, Boomer54 said:

and 3 legged dog outside Waitrose.

4 cats and outside Aldi  . and it's going to be a " begging trough "   .  a bowl just won't hold enuf lose change 😇

Malc