Reverse Mortgage or Equity Release

C

Courthero

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Hi, first post so forgive me if this is answered somewhere or has an obvious answer.

My parents live in a house worth ~300k, they owe ~90k on their mortgage (re-mortgage in mid 00s) with 10 being arrears. It would take them about 10 years to pay this off at the rate they are paying now (600 p/m). My father however is 61 and works in the building trade and I cant see him being able to continue for that long.

My question is, is there a way for them to sell the debt and continue to live in it?Like an equity release situation.Whoever buys the debt doesnt look for a monthly payment and instead owns a percentage of the house and is paid on the sale of the house in the future?
 
Hi, there's no product currently available, but AIB are proposing to reintroduce equity release mortgages.

These products have been heavily criticised, as interest compounding at a rate above normal mortgage rates accumulates to a very large number, especially with long life expectancy. Shouldn't be entered into lightly.

Do your parents have pensions, and if so would they have a know sum on retirement?
 
In my view it's a potentially good product if sold to informed customers etc .
What stops it being sold is fear of future mis- selling accusations and litigation of disinherited (greedy (?) ) offspring etc . And accusations of I did not understand etc . After Having spent the money ...
I hope it becomes available but I doubt it. ....
 
Hi Courthero

Have they spoken to their lender?

In my view, if they have a non-tracker mortgage, the lender should be delighted to switch it to interest only. But banks and their supervisors are thick and don't understand this. They think that the capital on a loan must be repaid - which is like saying that a tenant must be able to buy the property she is renting.

Brendan
 
Thanks for the reply. I don't think so. I think my father had an amount in the cwps but drew this down when he had medical issues and was out of work for a year.
 
Thanks for the reply. Their lender isn't a bank, it was one of those companies that you used to see all over the tv during tge celtic tiger. They dont lend anymore and as far as i can see tgey just want their money and to get out. I don't think they would be in to that arrangement.

I will say it to my Mam to bring it up.
 
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