Margaret’s husband, Chris, died at the age of 60. This was a few weeks after being diagnosed with cancer. Margaret and their three children were shocked at how quickly it had all happened, and were devastated that he had died.
Margaret is now 56, and has been left with credit card debt which has built up over the last 5 years. Margaret and Chris both used to spend quite freely on their credit cards.
They usually paid off the minimum balance due, but always thought they’d pay off the total balance with Chris’s pension later on down the line.
When Chris died, his pension payments were reduced and Margaret realised that the amount she now received as income was only just covering her day to day living. She had retired a few years ago due to ill health, and returning to work wasn’t an option for her. She had 12 credit cards with outstanding balances and she began to miss the minimum payments due on them. Over the course of a few months she began to get worried about her financial situation.
Margaret confided in one of her friends, who recommended that she spoke to a financial adviser. She approached a local adviser, who reassured her that they’d find a solution.
Her financial adviser told her that a lifetime mortgage was a sensible way to consolidate unsecured debt. By taking a lifetime mortgage which allowed ad-hoc payments, Margaret was able to consolidate the £20,000 due on credit cards. She could then start to make interest payments when and start paying one lower monthly payment of £100. This has allowed her to regain control of her finances. By making regular interest payments she is keeping the mortgage balance level, and is able to leave an inheritance to her three children.