RELEASING MONEY FROM HOUSE

[kopend]

CAN ANYONE ADVISE WHAT THE BEST WAY TO GET SOME MONEY FROM THE HOME MY MOTHER LIVES IN,SHE LIVES ON HER OWN & CANT WORK.
HOUSE IS WORTH APPROX £150K TRIED SELLING IT THAT DIDNT HAPPEN AND SHE OWES ABOUT 3K LEFT ON THE MORGAGE BUT IS STRUGGERLING DAY TO DAY TO PAY THE BILLS AND JUST NEEDS MONEY TO GET BY SHE IS 67. IVE HEARD ALSORTS OF BAD THINGS ABOUT RIP OFFS AND TOLD NOT TO DO IT IS IT THAT BAD?
THANKS

[ummmm]

She could try to remortgage with her bank.

[hc4361]

Doubtful she'd be able to remortgage at 67 with no real income.
Is she getting all the benefits she is entitled to?
Would she consider taking in a lodger?

[factor-fiction]

This is a difficult area- you do have to be very careful not to get ripped off, although there are some reputable companies out there.
You also have to consider the state benefits position. Does she get any state benefits such as Pension Credit, Housing Benefit or CouncilTax benefit. If you take out say £20000 cash out from the value of the home you can lose that ina few years in lost benefits. It may be better to take out as much as possible and just accept that yshe's unlikely to get these state benefits again.
It's a trap many people are caught in.
Age Concern can probably advise her.

[buildersmate]

Wholly agree with Factor 30 here. In addition to what he says there are 'equity release schemes'. There are many providers and I will provide a link to what Prudential say on the matter - not because I am recommending it but because it seems to explain them clearly.
Basically the provide a cash sum to the home owner to exchange for either a loan secured against the property (a larger mortage essentially) or in exchange for part of the equity share of the house. The company gets its money back when the homeowner dies (so it comes out of the value of the estate of the deceased)
The first type are called 'lifetime mortgages', others are called home reversion schemes. With the latter, you lose part of the equity.
You must get proper financial advice before deciding. Talk to Age Concern first, who will not provide the advice but will know a man who does.
http://www.pru.co.uk/equity_release/guide/using_home_equity/