The Sunday Times - Pensioners warned over interest trap on home loans
Older people are using their homes like cash machines, taking out a record £4.2m a day through equity release products, according to figures published last week — but the consequences can be devastating.
Today, the former British No 1 tennis player Andrew Castle reveals his outrage over the plight of his parents-in-law, who borrowed £70,000 and had to pay back £46,000 in fees and charges within just six years.
Aaron Strutt of the mortgage broker Trinity Financial, told The Sunday Times: “There has been a rapid rise in the number of older borrowers taking equity release mortgages, often because they have been refused finance by high street lenders.
“People should work out whether they really need the money before they sign up to an equity release product, because the rolled-up interest can quickly erode any equity in a property.
“More people should speak to their families and work out whether there are any cheaper options before they lock in to a deal.”
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