The Question
My mum recently met a new partner, and he has moved into her home – which is also the family home. It’s the house myself and my brother grew up in and so it holds value both in the monetary sense and in an emotional way too.
Here’s where I need help: my mum’s new partner has persuaded her to release equity on the house. The property is worth quite a significant amount – around £600k by my estimations. They are both being very vague about the process and we are getting quite concerned because we don’t know how much they plan to release, what they will do with it and so on.
My mum’s partner is not someone we know well. He came into her life just over a year ago and he seems to have no property or assets of his own.
Do we have any rights in this situation? I know they have spoken to an adviser, but nothing has been finalised yet. As potential beneficiaries of the home, would the equity release provider need our approval? Would mum’s partner’s involvement raise red flags to financial company? I am very worried and confused and would value any insights you could provide, please.
The Answer
As potential beneficiaries to your mums’ estate, I can understand that you feel anxious and unsure about the short and long-term financial impact on your mums’ plans for you and your brother. However, as it is your mums‘ home, ultimately the decision to take equity release is hers, you may have to respect her privacy, and you may not be able to prevent her from doing so.
I would strongly suggest that you talk to your mum and explain your concerns and ask her if you could attend a meeting with her financial adviser. This would allow you to support her and ensure that the advice is the best outcome for her.
During the meeting you could gauge the impact on her estate and the adviser should explain that with equity release and lifetime mortgages, there is an option to include inheritance protection or make payments which could benefit all parties as this would ensure that the reduction in the value of the estate could be minimalised.
However, as noted, the decision is solely that of your mum and you have to respect her privacy.
Finally, I can confirm that the provider would not need the approval of your mums’ beneficiaries, and you would not be contacted. It is not clear if your mums’ partner is a party to the application, or it may be that he is just supporting her, and he would leave her home if she passed away or needed long-term care and that he may be prepared to sign a waiver of occupancy to this effect.
This is why I strongly suggest you discuss potential plans with your mum and ask if you could attend a meeting; however, as noted, you must respect her privacy if she declines your support.
Meet our expert…
Mark Gregory, founder and CEO of Equity Release Supermarket, is here to answer your questions. Mark is an adviser himself with over 20 years equity release experience.
He launched Equity Release Supermarket 10 years ago and it has grown to become one of the UK’s leading equity release specialists.
Email kate.saines@emap.com to ask Mark a question
