Equity Release

Equity Release

Equity release is a financial product for people over the age of 55 up to the age of 95 which allows you to release some of the equity tied up in your home. The money released, can be taken as a single lump sum payment or more than one payment but in smaller amounts, following an initial lump sum. In order to release equity from your home you will need to speak to our specialist advisor John Valentine

What are the benefits of Equity Release?

  • You will remain a homeowner
    You will remain the legal owner of your own home until it’s sold once you and your partner have passed away or moved into long-term care
  • No negative equity guarantee
    You won’t ever pass any debt on to your estate or family once you pass away or go into full time care – providing your house is sold for the best price reasonably obtainable. We only use lenders who have this guarantee
  • Our inheritance guarantee
    You can safeguard a percentage of your home’s value to leave behind as an inheritance – although this may reduce the amount you’ll be able to borrow

What are the disadvantages of Equity Release?

  • Reduced inheritance
    Although you can safeguard a portion of your home’s value as inheritance, its sale will go towards paying off your lifetime mortgage so the amount you can leave as inheritance will reduce
  • Potential tax and welfare benefits impact
    Releasing equity can change your tax position and potentially alter your eligibility for welfare benefits – a financial adviser will help explain the impact and we recommend you fully check your situation via the Department for Work and Pensions
  • Added interest
    Interest is paid annually onto both your loan and interest already added, which quickly increases the amount you owe. Then, everything’s repaid once you die or go into long-term care, usually from the sale of your home, subject to terms and conditions. There is also rolled up interest plans available – your financial adviser will help explain this
  • Lifetime commitment
    If you’d like to end your lifetime mortgage early, then you may have to pay a substantial early repayment charge
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