Consumer rights: 'Are my mum and dad being scammed out of their home?'
A worried daughter should consider interfering to ensure her elderly parents understand equity release and dealing with payday lenders
Sunday 29 July 2012
Q: My parents have been trying to sell their house for a while now and they've had one very good offer. But almost as soon as it was made they seemed to regret the decision to sell. I suspect they really don't want to move as they've been in their home for 40 years and love the area and the neighbours.
However, they're also getting very worried that their savings are dwindling and their pensions aren't enough to live on.
Someone has been trying to persuade them to go for a scheme that allows them to borrow some of the value of their home but go on living there. I haven't met this person, don't know anything about them and am worried that my parents are being pressurised into something dodgy.
If they did go for this kind of scheme it seems to me they would be, in effect, taking on a mortgage in their seventies. I don't want to interfere but I'm worried they could end up losing their home.
A: It always worries me if older people feel they are being pressurised into making decisions. If I were you I'd interfere and insist on going along to any future meetings between your parents and the person they've been talking to. It could all be above board and you may find that they've been talking to a financial adviser about an equity release scheme. Even then, though, they shouldn't feel under pressure to make decisions.
Equity release schemes have had a bad press because they used to be inflexible and poor value with the real chance that people could lose their homes. But, there is a new generation of equity release products from responsible lenders available, so your parents could find a scheme that suits them. Despite that, equity release isn't the answer for everyone and your parents need help to come to the right decision and find the right deal for them.
Homeowners who are 55 and over often find that almost everything they own is tied up in their property and they have very little left over to live on – asset rich and cash poor. Equity release allows them to take some of the value of their bricks and mortar as a lump sum or regular smaller sums, and stay in their home without having to make monthly repayments. Of course the deal with the lender will be that when the property is eventually sold the lender will get their money back. Your inheritance will be reduced as a result.
Your parents need to make sure they don't get involved with a rogue lender. Only buy an equity release scheme from an organisation licensed and regulated by the Financial Services Authority.
You don't want to interfere but you can persuade them that they should take the time go into this in detail. Find them an independent financial adviser who has experience of these kinds of plans and can talk them through the pros and cons.
You'll find more information at equityreleasecouncil.com or from Saga or Age UK.
Q: I took out a payday loan a few months ago when I needed an emergency repair on my car. But a few weeks later I was made redundant. I'd only been in the job a short time I didn't get any redundancy money. I haven't been able to get back into work so far and now the loan company is really piling on the pressure and the interest. At this rate I'll never be out of debt. I'm really worried, it's affecting my health and I can't tell my husband what I did.
A: You aren't alone on this. More and more people are finding themselves in your situation. These high interest loans can be life savers in an emergency – as long as you can pay them back in full on time. But they can cause mayhem in people's lives if things go wrong.
Charities that advise people in debt are working with the payday lenders to persuade them to treat borrowers in your situation more sympathetically. They want lenders to freeze interest and charges as soon as they realise their customers have lost their jobs, and to set up affordable repayment plans.
In the meantime get help from one of the free debt advice agencies like the Citizens Advice Bureau on the high street, call CCCS on 0800 138 1111 (cccs.co.uk) or the National Debtline on 0808 808 4000.
Mark Dampier: 'We're on our own in retirement. They've pulled pensions to pieces'
HSBC becomes first bank to offer five-year fixed rate mortgage with interest rate under 2%
Crippling PFI deals leave Britain £222bn in debt
Pension freedoms: How to deal with cold calls from scammers
Barclays new Blue Rewards hands cash to customers. What’s the catch?
- 1 Rarest Beanie Baby of them all could be sold for £62,500 on eBay
- 2 Ben Affleck asked TV chiefs to hide slave-owning ancestry, new hacked Sony emails published by Wikileaks claim
- 3 Driving while dehydrated can be just as dangerous as drink driving, study suggests
- 4 Farmer told to tear down mock-Tudor castle after hiding construction behind hay bales
- 5 One Direction: Louis Tomlinson launching his own record label, has already 'signed two acts'
If I’m being racially abused I don’t need a stranger with a saviour complex to rescue me
The only black face in the Ukip manifesto is on the page about overseas aid
Ukip is the only main political party to not address LGBT rights in its manifesto
Food banks: One million Britons will soon be using them, according to Trussell Trust
Religion isn't growing, it is becoming vigorous in its demise, says philosopher AC Grayling
BBC election debate: The one photo that summed up the whole 90-minute leaders debate
iJobs Money & Business
£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...
£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...
£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...
£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...
Day In a Page
With space for an equestrian business, a greenhouse for growing your own veg, a wine store and a gym; this five-bedroom home has all the ingredients for a country retreat.
This four-bedroom home has exposed brick chimneys and a vaulted ceiling in a breakfast room that's ideal for summer entertaining - the doors open to the patio and garden.
The decked roof terrace of this two-bedroom flat is perfect for summer drinks while large windows and ample storage space make for a light and spacious interior.
Surrounded by approximately 15 acres of grounds, this six-bedroom grade II-listed home has been extensively refurbished yet retains many period features.
This four-bedroom home comes with a two-bedroom cottage and commercial office, with planning to extend, in a stunning courtyard setting.
In a pretty Norfolk village, this four-bedroom family home is surrounded by landscaped gardens, with even a self-contained annex for guests.
A few miles from the seaside at Perranporth, this four-bedroom farmhouse sits amongst nine acres of idyllic grounds - including a lake and two barns used as holiday lets.
This five-bedroom home is arranged over three floors of a converted Victorian hospital, offering spectacular views of the Pentland Hills - only three miles from the city centre.
This four-bedroom detached home comes with grounds that span to approximately 2.5 acres, as well as two large patio areas and a double garage.
This four-bedroom cottage is a Grade II-listed town house, well-located for the thriving market town of Nailsworth.
A four-bedroom apartment on the ground floor of a stunning period property in North Yorkshire, with two kitchens and a large south-west facing garden.
This high-spec two-bedroom home is part of a smart collection of new flats at Beaufort Park and has a large decked balcony that's perfect for summer drinks.
Capitalise on the fabulous views of Trevone Bay by taking two homes and creating one spacious boutique B&B. Just a cliff-top walk from Padstow.
Overlooking a golf course, this six-bedroom Edwardian detached home spans four storeys and retains many period features including the original, operational servants' bells...
On the edge of the city, this six-bedroom home comes with an outdoor swimming pool and a large garage block that has annexe potential.
In a Grade II-listed manor just outside of Bath, this three-bedroom home is arranged on two floors with a skylight in a vaulted roof line.
Open the living room's bi-fold wooden doors to reveal a retro-style kitchen, and a conservatory leading to a paved garden at this three-bedroom home.
A Grade II-listed, four-bedroom home, in a charming Somerset village, with a two-storey studio that could be converted into a holiday cottage
A modern four-bedroom Victorian home, within walking distance to the high street
A luxury apartment in the Gothic mansion of Wyfold Court in Kingwood, offers six bedrooms spread over three floors and a turret
This school conversion, near Stockwell Tube, oozes New York loft style. The one-bedroom flat features double height ceilings and exposed brick work
This six-bedroom Georgian home is on three floors with open fireplaces, a two-oven Aga, an annexe, and cottage gardens with outbuildings and a car barn
High Crest House covers an impressive 9384sq ft, with almost three acres of grounds including a tennis court and summer house enclosed by electric gates
A six-bedroom farmhouse with separate accommodation in converted stables. Situated in the village of Church Aston, within walking distance to the market town
A two-bedroom flat with under-heated walnut floors and bespoke built-in storage. The Tube and Clapham Common are a short stroll away
A refurbished seven-bedroom townhouse with staff quarters, cinema room, superb gym, steam room and plunge pool
A minimnalist four-bedroom home designed to the highest spec, featuring glass walls and a kitchen space lit by a glass roof
Hibernate during winter and make your living during the summer at this busy guesthouse with panoramic sea views, in the village of Lynton
A four-bedroom penthouse next to the Tate with direct views of St Paul's from two floors of luxurious living space
A four-bedroom detached home surrounded by spacious gardens and woodland, close to New Pudsey
An 18th-century, three-bedroom home near Langstone Harbour built from ships beams with vaulted ceilings and wood burning stoves
A five-bedroom semi-detached home with a mix of period and modern features in a popular and convenient location
This five-bedroom red-brick beauty overlooks the village green and sits in just under two acres of land
A three-bedroom villa with self-contained flat, minutes from Lake Windermere
A five-bedroom Victorian home with four receptions, superb gardens and paddock in Pembury
An eight-bedroom house on the south side of the The Green with cinema, wine cellars and summer house
This 17th century beauty is full of rustic cosiness, while the detached home office means you can also run a business
Four exclusive apartments in a Grade II-listed former medical school with 2,275 sq ft of living space and 18ft ceilings
A five-bedroom terraced house on the popular Peterborough Estate, ideally located for both Eel Brook Common and South Park
A state-of-the-art farm-building conversion on the former Cliveden Estate, with 11,420sq ft of internal space, cinema and wine cellar
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
A boutique mews house, set around a central courtyard, with three bedrooms and a private roof terrace
A four-bedroom farm-conversion with three bathrooms and two reception rooms
A two-bedroom detached house with ensuite bathrooms and a sun-drenched decked terrace, £750,000
A modern and spacious two-bedroom, penthouse flat with two bathrooms in a prestigious development
A beautifully renovated five-bedroom terrace with three reception rooms and a courtyard garden, £700,000
A four-bedroom period house which has been extended to provide almost 2,500sq ft of living space, £675,000
A pretty three-bedroom Georgian home with a 22ft drawing room and a master suite with a balcony, £525,000