Releasing money from parents home.....??

You probably need to take specialist advice on this, as it depends on a lot of factors. A big one is whether the house forms the bulk of their estate, or whether they have other liquid assets that they can realise or reinvest in other ways.

If all they (you) want to do is to raise cash now, and assuming that they want to remain in the current property (instead of selling it and moving to a smaller property), then I guess Equity Release is really the only way to go. [I'm assuming they own their property outright]. In this sense, you can't avoid the 'finance' companies or insurance companies, as they are giving you cash now, and want a return on their investment later (whether it is in the form of the property itself, or the original payment + lots of interest).

There are other methods to 'fine tune' these arrangements, especially if they have an eye to minimizing their Inheritance Tax liabilites.

Maybe you need to elaborate a little....

Firstly, thanks for responding....

I'm not sure how much I can elaborate...let me try.

My wife and I would like to move now rather than in several years time. I have a good salary but am maxed out due to my CSA payments, existing mortgage and the fact that my 2nd wife has now left work to look after our kids 2yrs and 7 months old.

A common story I'm sure.

Also, without being morbid or totally materialistic we are aware that we will 'probably' inherit some money in years to come. Sources are My wifes parents, my mum, my grandmother and my great aunt. (I can't believe how bad that sounds when written down). We are just being realistic though and it is an open discussion subject in the family.

So, chances are we will get 'some' money over the next few years. All houses in question are owned outright and it would be good to free up

50k-80k in advance. Our current house is ok and we don't NEED to move. However, our current house is a corner plot place and is one of the best (in terms of price) places in our road. It's value is capped though by the value of the other places in the street and it would be better to move now(ish) while I still have some years of mortgage payment potential left in me

- I'm 43 with 10 years on my mortgage and a desire to retire at 58-60 years old. It's not worth moving and putting (say) 20K on the mortage as 10K (ish) will be wasted on stamp duty / estate agents / solicitor etc etc. THEN we will probably decorate. Net result = a 20K hike in mortgage which mostly gets swallowed up in the move process. We need to move in a bigger step in my opinion.

So, this is just a thought starter. A simple investigation into the possibilities that 'might' be open to us. We are not pushing our parents (it was their idea to be honest) - I'm just keen to find out if others have done a similar thing or if there are schemes/ideas that I don't know about. I'm an engineer not a financial bod.

Thanks > Paul wrote:

What I guess I was trying to get at is: Do your family have other assets, other than their main property, that they could pass onto you now, rather than at a future date - i.e. cash deposits or investments that are liquid and easily realised.

Extracting 'equity' from a property can be a convoluted process - i.e. valuations, surveys, legal fees still come into play. It is a bit like a remortgage - although you don't have to repay until later - but because the lender could wait a long time before they see anything back, you can bet that:

a) The interest rate they charge is higher than normal b) They will only lend a percentage of the value of the property anyway, based on the occupants age. If your parents-in-law are aged over 80, they will lend more than, if they were, say in their 60's.

So, although you don't want to waste money moving now, there is probably quite a lot of costs involved in doing this. Who will bear these costs ?

And also factor in whether your parents-in-law are in good health - if they live for another 25-30 years, the outstanding debt+interest could be collossal (see make sure any deal you go into means your parent-in-laws estate are never liable for more than the value of the property, full stop)....

I would say, if there is an easier way do it, don't go down this route

- or else, ask someone to recommend a decent IFA or Mortgage Broker who knows that they are talking about, and discuss this in greater depth....

Rgds SS