Bristol pensioners take cash out of their homes to cover soaring bills
A Bristol finance firm is urging struggling pensioners to talk to relatives before using cash tied up in their homes to cover rising bills as record numbers turn to equity release amid the cost-of-living crisis.
Manning Gee Investments says the number of people enquiring about equity release plans has quadrupled during the last few months as cash-strapped pensioners struggle to make ends meet.
Equity release lets homeowners aged 55 and over access tax-free cash from the value of their property. But Manning Gee Investments says using these lifetime mortgages to fund short-term needs may not be the right solution for everyone.
The firm adds that the increased local demand for equity release plans reflects a growing national trend. Homeowners aged 55+ took out a record 13,452 new equity release plans between July and September 2022, according to data from the Equity Release Council. This represents an eight per cent increase on the previous quarter.
And in the South West, the number of new equity release plans has increased by 25% since 2017, according to a new market report published by the council this autumn.
Samuel Gee, director of Manning Gee Investments in Bristol, said: “We have seen growing interest in equity release from retired people with mortgages who worry about paying their bills this winter. As well as soaring heating and food costs, the recent hike in interest rates is only adding to their financial worries.
“Equity release can offer a lifeline for some older people who have all their money tied up in their homes. It’s basically a loan secured against your property which allows you to stay in your home and it doesn’t have to be repaid until you pass away or move into care.
“But equity release isn’t right for everyone and we are concerned that vulnerable homeowners are rushing into it without consulting their children first, or considering other options that may be open to them.
“For example, you may have other investments or assets that could be used, or you could consider downsizing to a smaller property. It’s also important to understand the potential costs of servicing the interest on a lifetime mortgage.
“It’s therefore crucial that you seek professional advice and exhaust all options before making important decisions that could affect your home - and your children’s inheritance.”
For more information visit mgi.advicefront.com
