We all look forward to the day we will be debt free – financial security and peace of mind in retirement – a worthy aspiration is it not? Who in their right mind would want to extend the shackles of mortgage repayments through to their 80th birthday? – But that might be a blinkered view.
We all know how difficult it is becoming for our children to get on the property ladder and parents may want to help their children or even their grandchildren. If they don’t have the spare cash – the new mortgage scheme from Halifax could be the solution
There is also the inheritance tax angle. On death, you are only taxed on your net wealth – so debts need to be subtracted from the estate value. Having a mortgage could prove to have some tax planning benefits – but only if you die before it has to be repaid and we must assume that the money borrowed is spent or passed on to beneficiaries is a timely manner.
And in these days of low interest rates and soaring property prices, retirees can no longer rely on cash savings to give them a healthy supplement to their pension income. How long will it be before we see a new breed of landlord – one that comes to collect the rent using his OAP bus pass!
Mortgages for retirees – they have arrived. If you would like advice on this new product, or have any queries regarding inheritance tax planning or helping your children get a foot on the property ladder, please contact our mortgage adviser Claire Allison