children wanting to buy parents home to release equity

M

minto109

Guest
My parents own their own home (worth about £140, 000). All 3 of their children have since moved out & now own their own homes. Our parents are 59 and 60 years old and have part time jobs that just pay the bills. They want to release some or all of the equity of the house, but remain living in the house - so that they can enjoy the remaining years at home together. Myself & my two sisters have discussed the possibilty of buying the house from them (as joint landlords, as such) to enable this to happen. We would take an 'interest only' mortgage out on the house. They would pay us rent using some of the equity, to cover the mortgage.

Has anyone else done this?
Are there any smarter ways of doing this to lessen the impact of Tax, stamp duty, etc?
Are there other mortgage options?
I would assume that £140, 000 in my parents account would not work in their favour when the time comes for their pension to be calculated or if one or both of them were to be taken into care. Any suggestions?
 
When are both your parents 60?

When both parents are 60... there are lenders out there that are willing to consider releasing equity in the house.
Your parents can release approx 20% which would be 28K
Interest is charged at approx 6%. Nothing is paid now. This loan can be paid off at anytime. Its usually paid off on death.

Take a look at this site for more information

Any questions let me know.
 
I've heard the interest rates on these types of loans are extortionate! 20K wouldn't last very long!!
 
Thanx for the reply,

Both parents will be 60 by the end of the year.
 
You must log in or register to reply here.
Back
Top