Live life your way with Equity Release

When you are heading towards or starting your retirement, you may find yourself wanting a little extra money for any number of reasons: people are living longer, you may have unexpected demands on your finances from family, or your pensions may not be not living up to expectations.

This can feel as though you have no freedom to achieve any further life goals. It’s often forgotten that a large proportion of your wealth is locked up in your property.

You’ve paid into this investment for most of your life;
now is the time for it to work for you.

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What is equity release?

Individuals aged 55 and over can release some of the wealth tied up in their property without having to sell it.

If you, as a homeowner, decide to use equity release, you can draw a lump sum or regular smaller sums from the value of your home whilst still residing there. There are plans through which you can take as little as £10,000 tax free and leave further funds on reserve for when you need them.

The two equity release product types available are the lifetime mortgage and the home reversion plan, both of which are regulated by the Financial Conduct Authority (FCA). In the modern equity release market, there are various different features that go with these products. With providers coming up with new features all the time, there is bound to be an equity release plan to suit your particular requirements.

Am I eligible?

If you are a homeowner age 55 or over with a property worth at least £70,000, then you may qualify for equity release.

Where do you start?

You’ll have a lot of questions when approaching equity release planning, and you’ll need to think it through carefully, with all your options laid out in front of you, but where do you start?

It’s important to have an experienced and independent adviser to help you throughout the process. I’ll make certain that I give you the best advice from the current market, as well as from my own knowledge and experience, and in a clear and completely understandable way.

Popular reasons for releasing equity

  • Home and garden improvements
  • Going on holiday
  • Gifts to help friends and family
  • Paying off existing debts
  • Repaying outstanding mortgages
  • Help with regular bills
  • Increasing retirement income

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Choosing the right plan for you

It’s important to have the advice of a knowledgeable adviser at this stage, as choosing the right type of equity release plan depends on the following:

  • The market value of your home and the equity available
  • Your age
  • Your health
  • What your retirement goals are
  • Inheritance-protection options: view PDF
  • Fixed or variable early repayment charges
  • Downsizing protection: view PDF
  • Whether you’d like to make interest payments or not: View Video
  • What other options are available to you

Lifetime mortgage

This type of mortgage is secured on your property whilst you still own it. You can make monthly or partial repayments, or you can opt not to make any repayments; for both partial and no repayments, the loan amount plus any interest is repaid when the last applicant passes away or moves into long-term care. Usually, this is achieved through the sale of the property.
View PDF |  View Video

A Home Reversion plan

This means that part or all of your home is sold to the reversion provider in return for a lump sum, and you have the right to live in your property until the last applicant passes away or moves into long-term care. At that point, your property is sold, the reversion provider receives their share of the sales proceeds, and the leftover proceeds become part of your estate.
View PDFView Video

8 steps to responsible equity release

After your initial enquiry, I’ll arrange to visit your at your home. I’ll take some time to get to know you and find out what your goal are. Then I’ll explain the product feature of each if the different type of equity release and review your situation to assess the best option for you.

The next step is for me to research the whole market to find the plans that best match up to what you have told me. Once I have identified the most suitable plan, I’ll arrange to come back to see you to talk you through the details in full.

Once we have discussed the plan , I always advise that you speak with your family, so that everyone understands the arrangement. It’s a good idea to write down any questions that come up during these discussions. There will be no pressure from me to go any further or make any decisions at this stage; take your time and prepare as many questions as you can before our next meeting.

A at our next meeting, we’ll go over the details again to make sure that you fully understand the arrangement, and I’ll answer all the questions you have gathered since we last met. If you are happy to, I’ll then start arranging the relevant paperwork.

Once I have submitted your application to your chosen provider, they will arrange for a Royal Institute of chartered surveyors (RICS) property survey to confirm how much your property is worth, and, in turn, the amount of equity you are able to release and whether the provider is comfortable with lending against your property.

Once the property valuation survey has been completed, the provider will issue your personal offer to you. This will include all the term and conditions, and full details of your plan. We’ll arrange to meet again and go through your personal offer together. If there are any question at this stage. I’ll address them, so that you fully understand and are happy with your plan.

Once you are comfortable with your personal offer, the next stage is to appoint a solicitor to take care of the legal work. You may want the legal work to be carried out by your own solicitor or I can arrange for an independent solicitor to visit you at home at your convenience. When everything is ready to be signed, a meeting will be arranged, which I’ll be happy to attend, for reassurance, should you wish me to.

When everything has been completed by the solicitor, you’ll receive the money into your chosen bank account to spend how you wish. This usually takes between four and eight week.

You could potentially release:

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