[ad_1]
Other homeowners however are using the loan to keep their children afloat, rather than themselves, as they too bear the brunt of unaffordable mortgage repayments.
One mother, 78, said she used a lifetime mortgage to draw out £60,000 from her three-bed home in Essex for her two sons – one of which could no longer afford his £2,000 monthly mortgage repayments.
Prior to extracting any equity, the value of her house – an ex-council property she paid the mortgage off on back in the 1980s – was £425,000.
The mother-of-two, who preferred not to be named, said: “If we’re sitting on money, why not help them? One of my boys would have lost his house if I hadn’t stepped in.
“Hopefully there will still be some value in the house when I die. People tried to put me off. One friend of mine said when her 87-year-old mother-in-law passes she’ll have around £20,000 in equity in the house between three kids.”
Despite the risks, she has encouraged friends to do it too and is open to drawing out more equity should her sons need it. “I think it’s the way of the world with everything going up,” she added.
After more than a decade of rates at 0.75pc or below, more recent rate rises have left many homeowners whose fixed deals are ending – and those on tracker mortgages – facing “huge blows” to their finances, according to financial adviser Jan Johnson of 55Plus.
[ad_2]