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One percent

Intergenerational mortgages have arrived

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People having been doing this for years with Equity Release mortgages, one of the most popular reasons for releasing equity. Interest rolls up, eats into inheritance but at least the kids are on the property ladder. 

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6 hours ago, Dipsy said:

People having been doing this for years with Equity Release mortgages, one of the most popular reasons for releasing equity. Interest rolls up, eats into inheritance but at least the kids are on the property ladder. 

I didn't know that dipsy, thanks.  My assumption was that equity loans were a way of living it large; cars, holidays, cruises etc.  

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What bothers me most about this is that it instantly turns one lower LTV mortgage into two higher LTV mortgages, effectively cementing a new minimum house price threshold below which the banks cannot survive.

The banks know perfectly well what they're doing, and perfectly well who will be on the hook for it, IMO.

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On 03/05/2017 at 07:10, One percent said:

I didn't know that dipsy, thanks.  My assumption was that equity loans were a way of living it large; cars, holidays, cruises etc.  

No probably not! Old people won't pay extra for proper milk!

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4 hours ago, MrPin said:

No probably not! Old people won't pay extra for proper milk!

In my experience, they are paying extra for proper milk on their credit cards. It usually goes like this, stop working at 60 - spend money at same rate as when working by using credit cards and loans as pensions are way too small. About 5 years in, the credit facilities dry up but because they want to keep up their standard of living they get equity release to pay off the credit cards and to supplement their inadequate pensions to keep living it large. The other typical scenario is giving the kids the inheritance early.

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Just now, Dipsy said:

In my experience, they are paying extra for proper milk on their credit cards. It usually goes like this, stop working at 60 - spend money at same rate as when working by using credit cards and loans as pensions are way too small. About 5 years in, the credit facilities dry up but because they want to keep up their standard of living they get equity release to pay off the credit cards and to supplement their inadequate pensions to keep living it large. The other typical scenario is giving the kids the inheritance early.

Old people don't buy anything, cos they have it all!

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