Equity release

If, in either case, you don't pay the interest, the outcome is the same for either debt. You may call something similar or even identical in one area totally different, but I don't. However, there is no point in arguing about it.

These are debt vehicles. There are some positive reasons for taking on debt in older age and others where you cannot avoid this sort of solution. Nevertheless, I would advise paying an external advisor to give you an in-depth picture of the costs of doing this.

I think the fact that you can't pay off the interest makes Equity Release totally different.

kittylester

The way forward is probably a lifetime mortgage.

You release so much of the capital in your house and that amount is taken from the proceeds of your house sale either when you die or go into care.

You need to pay off the interest annually or it is added onto the capital and interest is charged on the total amount owed ie capital plus unpaid interest.

If you pay off the interest annually, the only remaining amount is the initial amount borrowed. And the value of your house will probably have risen

Equity release is totally different.

I don't think Equity release is totally different kittylester. It is as you describe except you have agreed and so have the company that you will not pay any annual interest, so the interest compounds. That's why it is so expensive as would be your Lifetime Mortgage - if you didn't pay the interest.

For most people, there are cheaper ways to borrow money if you need it and it is worth getting advice if this is the case. If you don't need it, why get into debt?

You don't say how old you are Willow but depending on that it could be seen as deliberate deprivation of assets should you need care.

Please be careful which firm you choose.

A friend of mine is in a care home with dementia. After she retired she took out equity release from her house to pay for holidays and upkeep of the house inherited from her parents.

To pay for 24 hour care at home more equity was released from the house but as one of the Powers of Attorney was a lawyer I doubt if anybody would take him for a ride.

the home is now sold and where it was situated it made more money so that extra is paying for her present care. She has not had a clue about it for many years.

Please be careful.

The way forward is probably a lifetime mortgage.

You release so much of the capital in your house and that amount is taken from the proceeds of your house sale either when you die or go into care.

You need to pay off the interest annually or it is added onto the capital and interest is charged on the total amount owed ie capital plus unpaid interest.

If you pay off the interest annually, the only remaining amount is the initial amount borrowed. And the value of your house will probably have risen

Equity release is totally different.

My aunt released ten thousand pounds, on her death ten years later her house was sold and a hundred and twenty thousand pounds were taken from the proceeds by the company. We contacted the financial ombudsman about it and although they wanted to help, and tried all ways, nothing could be done as it was all above board. The sad thing is she never spent the original ten thousand and didn’t need it, she must have been talked into it by the company.

There must be some reputable firms out there as many people happily do it, read the small print.

I know there are strongly held views for and against Willow and although I haven't any personal experience, my mum and step father did do equity release and were pleased they did.

It enabled them to do things they otherwise wouldn't have been able too. You need to shop around and get as much information as you can so you are fully aware of the financial implications.

If you feel it would give you a better quality of life, it's certainly worth investigating.