Sick Brits forced to cash in wealth to skip huge NHS waiting lists | Personal Finance | Finance
Britons are increasingly tapping into their property wealth to fund private health operations such as hip or knee replacements amid huge NHS waiting lists.
Details have been revealed following research from the Equity Release Council which identified a rise in older people taking a loan against their home.
Total lending under the heading of equity release hit £578 million in the second quarter of 2024, which was up 15 percent on the first three months of the year.
The average new lump sum borrowed was up 7 percent over the same period to £110,969.
Home loan experts said many of the people involved bought their properties with interest only loans, which means the original capital sum borrowed has to be repaid when the mortgages come to an end.
These people are now taking out an equity release loan to pay off that figure and raise cash to fund their lifestyles. The equity release loans, which generate significant interest, are paid off when the home owner dies or permanently moves into a nursing home. This means there is often little, if anything, to leave to loved ones.
The waiting list for hospital treatment rose to a record of almost 7.8 million in September 2023. It has fallen since but too many people are still waiting far too long.
Scott Gallacher, Director at Rowley Turton, said: “Due to NHS delays as a result of the pandemic, we’ve seen people turning to equity release to fund hip or knee replacements.
“There’s little point having capital tied up in your home but being unable to enjoy your retirement due to a dodgy hip or knee.
“Perhaps the key concern is the impact that equity release can have on the inheritance you might leave. Though that’s more of a concern for your children than you.”
Justin Moy, Managing Director at EHF Mortgages, said: “Whilst the uptick in enquiries has been steady throughout 2024, the most common trend has been for both mortgage and debt repayment, a sign that the financial squeeze has become prevalent in all age groups.
“Interest-only mortgages arranged 25 years ago need to be repaid, and with savings and investments used for the day-to-day bills, older borrowers have little option but to seek such products.”
Simon Bridgland, Director at Release Freedom, said around 33 percent of equity release clients are releasing cash for things such as gifting, home improvements or holidays.
Director at Exemplar Financial Services, Iain Swatton, said: “Homeowners are considering equity release to bolster retirement income and support children or grandchildren with property purchases, among other essential reasons.”
