Mortgage Or Not ?

[ferret69]

I am selling my property for £200,000 and buying another for £250,000 so we need £50,000 to make up, I have £75,000 in savings but not sure if its best to use that or have a mortgage, me and the wife are both 74 and have a joint pension income of £20,500 a year, any advice please.

[bookbinder]

If my wife and I were in your place, we should use the £75,00 savings. We do not like owing anybody anything, and using the savings would mean that we should not be in debt to anybody. After all, none of us knows what's around the corner, and we should like to be able to sleep easy at night.

[bookbinder]

...correction: 'use the £75,000 savings'.

[Bazile]

I'm no expert - others will come along soon

But I would have thought, look at what interest you could get on your savings and compare that to what interest you would be paying on the mortgage

[jackthehat]

I think that finding a mortgage lender at your age may be problematic.
In your place, I would seek independent financial advice.

[Apc2604]

Personally, I would take it out of savings. I am in the same age group. Why would you want a mortgage and be paying out monthly in times of uncertainty. It would depend obviously of why you feel your savings are necessary. You may have a plan for them. A financial advisor might give you better advice than we can give on here without knowing your circumstances.

[david small]

We are in a similar situation. Except it would be £100,000 extra needed. I also would not have a mortgage. There is a form of equity release that allows you the money on draw down. You only take what you need when you need it. So in effect you have access to £100,000 if and when required. This is after you’ve purchased the new property of course.

[Apc2604]

Funnily enough our savings in Business ISAs are now back to what they were before Covid. Other savings are providing no interest worth talking about, so we are spending them on improvements to property. Our financial adviser is worth his weight in gold. The thought of being tied to a mortgage at our age is quite frightening and as Jack says there are very few mortgage providers who would be willing to lend at our age.

[TrevorThePug]

What was the £75k being saved for? If you will still have enough leftover from the savings plus the pension, to enjoy life and do what you need and want then I’d say use that rather than borrow.

[Peter Pedant]

use savings
estimate how long you will live - age of death of parents are a strong indicator
and try to get a mortgage

I wd use savings - I am in almost the same position as you.
and in fact am liquifying assets and giving them away
( the issue there being IHT efficiciency)

[Peter Pedant]

aaaargh
someone has mentioned the dread equity release

good advice - - do NOT do equity release in any form ....

[ferret69]

Thanks everyone, you all agree so using my savings it is.