Retirement

[sidney]

I will still have a big mortgage when I retire what are my options when I cannot meet my payments

[Mrs_Pegasus]

Difficult one and one I would like to know the answer to as well!

The reason I say this is because my hubby is due to leave the army in 2 years time after 22 years and in effect he is retiring, the fact he will only be 40 and will continue to work doesnt wash with lenders and we have recently struggled to get a mortgage because of this fact!  (Even though he gets a sizeabe gratuity when he leaves which would equate to 4 years mortgage payments!)

I am therefore surprised you were able to secure a mortgage that extended beyond your retirement age.  I daresay the lender will be brutal in their response by saying you were knowledgeable of the outcome when you took the mortgage and it would therefore be up to you to find a way of paying it.

Could you sell now and buy a smaller property with the profit?  You would probably be able to sell the property and then apply for local authority housing.  Many retired people do this so they can enjoy their equity (I think its calling SKI'ing (spending kids inheritance!)

Hope this helps.

 

[vicars]

Options:

1. Downsize to reduce your mortgage or pay off completely.

2. Negotiate with your mortgage company to pay smaller amounts (they have to be reasonable in their approach with borrowers). It is well worth asking their debt department NOW what the likely options are.

3. Change the mortgage to a lifetime loan where you borrow against the property based on your age. The plus point is you do not even have to pay any interest and can still make repayments if you can afford to do so. The negative side is the interest rates are slightly higher and your kids get less as an inheritance, but look after yourself first!

4. Get a lodger - renting a room can be tax free.

5. Ask your local department of whatever they are called thesedays to see if benefits are vailable.

[Pink Hippo]

Hi there, don't forget that there are all sorts of tax benefits from paying into your pension.  If you're eligible you can pay in �2808 and the tax will be reclaimed to make the amount actually allocated to your fund to �3600.00  Pensions have radically changed over the years and they are much more accessible.  There will also be the possibility of a tax free lump sum upon retirement.  Speak to a financial adviser (this should cost you nothing to get advice) and see what they say.  Best wishes