Must pensioner get out her screwdriver?

I am a 70-year-old, semi computer-literate lady. On 8 January, I purchased a Tiny computer and paid by Visa. I assembled it myself and paid £99 to have home service for any problems.

One of the speakers did not work and an engineer was booked to come on 29 January, but phoned to say he did not have the necessary parts. Then Tiny went bust and was bought by Time. Now no one has any idea what is happening about servicing. If Time does not honour these guarantees, can I open up the computer and sort it out myself?
JF, Gloucester

On 30 January, Time bought Tiny's assets but not its liabilities, believing the extended warranties were insured. It soon found that Tiny had not paid the insurance premiums for six months and honouring them would cost millions of pounds.

Time will uphold warranties paid for in cash or by cheque. Customers who bought on credit through First National Tricity Finance are also covered. But people like you, who paid by credit card, are out in the cold.

The card companies have told Time they will refund warranty premiums and the cost of computers not received, but they will not pay the cost of the continuing warranty service. Time is providing credit card customers with telephone support butnot back-up service.

A Time engineer has now phoned you and sorted out your problem. You should claim a refund from your card company and either buy a new warranty from Time or use a local repair firm for future breakdowns.

Double premium for 20pc extra

My £50,000 contents insurance policy with RIAS is due for renewal at £90. I asked to increase the cover to £60,000 and was told it would cost £100 more. Why does increasing the cover by 20 per cent increase the premium by more than 100 per cent?
AG, Orpington

RIAS sells low-premium insurance to low-risk older people. It keeps the cost down by selling a one-size-fits-all policy, underwritten by two insurers. The blanket coverage includes contents cover up to £50,000, and RIAS says most customers insure for less. Once you step above that, you lose the low-cost advantage. Although a broker, RIAS passed your request to insure for £60,000 to one of the two regulars. RIAS reckons you will still find the higher quote competitive.

Two mortgages, double trouble

We are retired, with a mortgage-free house worth about £140,000. Our daughter and son-in-law have an 18-month old baby and need to move out of their rented flat because the freeholder has objected to the baby. They are in relatively secure jobs but their earnings are too low to raise a whole mortgage to buy in London. Can we raise money on our home to help them?
IB, Liskeard

If you and your daughter both raise mortgages, you will pay two sets of legal and valuer's fees. Instead, you could stand guarantor for their mortgage or give them money for a 10 per cent deposit. The bigger deposit would save them the cost of mortgage indemnity premiums and might enable them to borrow a larger multiple of their salaries or negotiate a better deal.

If you have no other option, there are schemes for older people to take equity out of their home, some requiring no repayments and others only interest but no capital until you sell the house. The amount you can borrow varies between 30 per cent and 75 per cent of your house's value. Talk to Northern Rock, Norwich Union, Scottish Widows, Halifax and Nationwide.

Taxman allows wedding windfall

I read the recent letter about making £5,000 wedding gifts without attracting inheritance tax, but what happens if you have two children marrying in the same year? Also, with the £3,000 that I can give to anyone each year can I give £3,000 to each child or is it £3,000 in total?
BL, Basingstoke

Under inheritance tax rules each person can give a total of £3,000 a year, so two children could receive £1,500 each. You can also give any unused portion of the £3,000 allowance from the previous year.

The marriage allowance is based on each child. So your children can receive £5,000 each even if they all married in the same tax year. Your wife has identical allowances, which doubles the amount parents can donate.

· Email Margaret Dibben at money.writes@observer.co.uk or write to her at Money Writes, The Observer, 119 Farringdon Road, London EC1R 3ER and include a telephone number. Do not enclose SAEs or original documents. Letters are selected for publication and we cannot give personal replies. The newspaper accepts no legal responsibility for advice.