Newspaper article The Journal (Newcastle, England)

YOUR MONEY Your Money Queries Are Answered by Trevor Clark, Director of Rutherford Wilkinson Ltd, Chartered Financial Planners

Newspaper article The Journal (Newcastle, England)

YOUR MONEY Your Money Queries Are Answered by Trevor Clark, Director of Rutherford Wilkinson Ltd, Chartered Financial Planners

Article excerpt

Q. My mother, who is 78, needs to ? raise some money for a new central heating boiler. She has only her state pension with a small savings account, but she owns her own home which is worth PS200,000, with no mortgage outstanding. What options does she have? A) The first thing to check is whether your mother is eligible for any subsidies to upgrade her boiler for a more energy efficient one. Contact the Energy Saving Advice Service on 0300 123 1234.

She would need to be eligible for, and claiming, Pension Credit, which many people do not realise they can claim. If she is not claiming it but is eligible, you should contact the Department for Work and Pensions on 0800 991234. You can call on her behalf, but she must be with you when you call.

Failing that, there are some ways to raise money against the value of your house. The first option is to downsize to a smaller house. Alternatively, you could sell your home to a home reversion company, where your mother gives up ownership but retains the right to live in the house for life, or until she needs to go into care.

The third alternative is a lifetime mortgage, which allows people to borrow against the value of the house, but unlike a normal mortgage, no interest or repayments need to be made on a monthly basis.

Instead, the interest rolls up until the mortgage is eventually repaid, either on death or going into residential care.

A flexible lifetime mortgage has the further advantage that only a small amount needs to be borrowed up front, with a facility to borrow more in future, meaning interest is only rolling up against what has been borrowed. You should take advice from a chartered financial planner with specialist knowledge in this area.

Equity Release includes home reversion plans and lifetime mortgages. To understand the features and risks ask for a personalised illustration.

Q. I realise I made a huge mistake ? the other day. Having received yet another letter from my building society advising me that they were reducing the interest rate on my cash ISA(NISA) I marched into the local branch office to close the account and I got a cheque for just over PS43,000. …

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