> >The house I live in is owned by my Mother [50%] and the remainder shared
> >equally between myself and three brother, ie 12.5% each.
>
> Is this sharing arrangement official? You may wish to ensure that
> everything is legally documented to avoid someone else having full
> control in the unfortunate event of your mother's demise.
>
> >Mother is in the advanced stages of raising 15k for much needed home
> >improvements/repairs.
>
> If she own half the home is she paying for half the repairs or all of > the repairs? >
> >She has discussed this with all of us and we have agreed that she should
> >take advantage of her equity and live her last years in comfort. She's 68. >
> Is she unwell? Is your family known as being relatively short-lived? I
> ask because she should be able to hope for another ten years or so. >
> >The Mortgage Code categorically states that, in the event of Mum's death,
> >house *must* be sold to raise the revenue to pay back the loan - effectively
> >leaving me homeless.
>
> If it must be sold I can see no logical reason precluding the four of
> you from being the buyers. Why should selling mean to anybody but you
> four? All the mortgage company wants is its money back i.e. capital > AND interest. >
> >The four of us don't necessarily want to sell the
> >house and are wondering if;
> >
> >I/We could take out a small (say25k) mortgage to pay back the loan. >
> Why not take out a 15K mortgage now (or a 30K one if you are already
> paying your way on the repairs) rather than allow the interest to
> accrue for maybe ten years or more? Presumably your mothe ris retiired
> and on a fixed income whereas you guys are in the prime of your lives
> and have a greater earning (and repayment) potential?
>
> >Any thoughts?
>
> Aside from the above, if there are four of you maybe you could cut the
> overall repair bill by doing _some_ of the work yourselves....
>
> It strikes me that any change to the well-advanced arrangements may
> result in a rather peeved "equity release consultant". Should you
> decide to take up a mortgage perhaps they can be your broker in order
> to avoid unpleasantness about wasted time and lost commission.
If the "consultant" were to become peeved or express any unpleasantness as a result of losing commission, they wouldn't go on to sell me anything, let alone a mortgage. The OP does not owe the consultant anything other than possibly a polite "No thank you".
However, he said that the deal was in its final stages and I have heard of some financial advisers making a case for being paid for their time when people have taken things to such a point and then backed out.
I am not saying this is right or wrong and, personally, I think that equity release schemes are an awful idea.
Mother's initial loan of 15k is going to cost us *at least* 30k assuming longevity, which runs in the family. Her mother was 88 when she passed on. The moral implications are also worth considering - The longer Mother is alive, the more it will cost us. I'm sure I don't need to expand this scenario.
By 'advanced stages', I was meaning that the money was already earmarked (spent!) on Double-Glazing, New Kitchen etc. The actual loan is now dependant on her 4 sons jointly signing a disclaimer effectively relinquishing our interest in the property allowing Mortgage Company to have first claim on *their dosh, not ours.
As for the potentially peeved consultant, I'm afraid that's tough. I see no difference to us going into [eg] a car showroom, discussing the pros and cons for an hour for us to turn round and say we'll think about it decline their offer. I'm sure we're entitled to a cooling-off period. Nothing has been signed.
Now all I have to do is convince Mother this is a bad plan. Easier said then done - the potential for family rift looms large.
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