If you are tending to find that your pension and any other income is failing to keep your head above water and your credit cards and other debts are starting to get out of hand, this article may well be for you? There are not that many options open to people who have retired, but we will offer some advice on one of the most common.
If you own your own home and have equity in it, there is an option known as an equity release lifetime mortgage that may well be of particular interest to you. This is basically when you are lent a percentage of the value of your equity and you then repay this amount upon your death. English law dictates that you cannot be evicted from the property, whilst you are alive, and this means you will be able to remain in your own home.
Do not presume that this matter is as straight forward as this, however. There are a few things you will need to investigate before you sign on the dotted line for that agreement, receive the cash and start paying off those credit cards.
Firstly, you will need to ensure that lifetime mortgage plan comes with a no negative equity guarantee: this effectively means that the lender would have to foot the bill if the interest accrued at the time of your death is higher than the equity left within the property.
You will also need to check the interest rates and shop around for the best deal. Firms will vary in the amount of money they will offer, but typically, for a person of around 70 years of age, you can expect a balance of 40% of the total equity.
