Giving Your House Away

Anyone desperate enough these days are going to think seriously by taking up offers, from their banks or other equity companies, to release their most prized assets; with dwindling pensions and savings, if not having any left at all, after the misdealing of banks and Governments.

I have met a few people who have done this, and found some disturbing facts. These are from especially pensioners who may require care or urgent operations to relieve their disabilities. Some are from the latest over fifties, who are no longer required because of their age and although an employer would deny age discrimination, try proving it. “There is always someone more suited to the job than yourself.” They would swear on their bible, with their fingers crossed or tongue in cheek. But that is just one of the many causes.

Mentioning no names and figures, I was informed of an elderly person who had to have some repairs done to their property. They borrowed a few thousand pounds only a few years ago. As they were pensioners and didn’t have adequate capital they decided to release some equity.

A few years down the line, one died, leaving the other with the worry of getting the house up to scratch in order to sale and downsize. However with the price of the house falling as well, the remaining pensioner has found that when they sell the house, the equity company will have to be paid the balance and with the cost of moving at an average £15-20,000, they are not going to get the desired small (Quality) bungalow, which is needed because they can’t get up and down stairs.

The other couple who are still together had the same scenario, when one had to have private surgery and vital home improvements have found that they owe a high amount after after only six years. What happens to the couple when the equity runs out, how will they live then? My estimation will be that the money will run out before either or both pass on. My other concern is if they do, will the value out-weigh the remainder of the loan, or will the company bang on the doors of the relatives (Children)?

I feel that although warning signs and concerns have been expressed about unscrupulous equity companies before; Not enough has been done to show or explain in clarity about the dangers. These Equity releases have been described and used in such clever marketing jargon, thus conning thousands from vulnerable people. With the Banks and Building Societies involved in the same and with the latest financial scams, hold them equally responsible.

One must remember the great hype or the miss-selling of endowment mortgages. With the financial burdens, people are still facing with the endowments now worthless, and having to take out another mortgage or face losing their homes, if they lose their jobs or are too old (50+) to get a job ,with the debt hanging around their necks.

Tim’s Tips

If you do not have debt, do not start. Budget within your means even if it is living on baked beans.

Your house is your roof, your pride and joy that you worked for all your working life!

Sell or downsize the car, It’s dangerous on the roads these days and getting a free bus pass helps.

Just get the basic digital TV licence if you cannot do without it! There isn’t much worth watching these days anyway, (or I might not be writing so much)

If you need something urgently, say for something medical ask for help in any other way than borrowing.

For any house repair or maintenance, get more than one quote including Age Concern. Agencies are expensive and sometimes it is cheaper to hire your own carer or tradesman. 

There are services that will help you for free. you just have to ask at places like the CAB (Citizen’s Advice Bureau) They have their own financial experts who can advise.

Finally there are many ways of avoiding debt with just a bit of planning and consultation, so have a good life.

 If you do not need to buy, don’t do it!

Gordon Brown’s (England’s Prime Minister) is wrong in trying to kick start the Economy with more debt.

And Do Not Get A Credit Card! They are for people who can afford them for paying instantly, to get discounts in some cases and know they have the funds to pay back before interest is charged.

Tim