JC Equity Release
It’s easy to overlook your property as part of your finances, but your home is probably the biggest asset you have.
Unless the value of your property has fallen for a specific reason, the many years you spent paying off your mortgage - along with the overall increase in house prices over the last 20 years - will have likely increased your home equity and therefore the financial potential in your home.
As well as downsizing, equity release is a way for homeowners aged 55 and over to unlock this potential and access some of the money “tied up” in their home.
Is Equity Release Right for You?
If you’re aged 55 or over and are considering later life lending options, equity release could be the solution you’re looking for.
The most popular type of equity release product is a lifetime mortgage, but the terms “equity release” and “lifetime mortgage” are often used interchangeably. With a lifetime mortgage, you borrow a percentage of the value of your home from a lender. You’ll still own your property but will have a loan secured against it. There are no affordability checks or requirements to make monthly repayments, as the interest charged is typically rolled-up – i.e. added to the outstanding mortgage balance. The loan plus rolled-up interest is repaid when the plan ends, usually after you or the last surviving applicant pass away or move into long term care.
Since its introduction, equity release has changed dramatically and is now a competitive, later life planning option for homeowners aged 55 and over. It was once seen as a “distress purchase” or a last resort, but that’s no longer the case. Plans have evolved and today include features such as:
- Lump sum and drawdown facilities – you can choose to take the cash in one lump sum at the start of the plan or as an initial release followed by smaller amounts that you drawdown as and when you need them. Interest is only charged on the money you release, not the full amount available
- Repayment options – you can make monthly interest payments or voluntary ad-hoc repayments which could reduce the impact of the interest rolling-up - this will be subject to the lender’s criteria
- Inheritance protection – you can ringfence a percentage of the future value of your home for inheritance. This will decrease the amount you can borrow from the outset, but will ensure a certain percentage of the property’s value goes to your beneficiaries
In addition to these features, the industry body - the Equity Release Council - has set clear guidelines for providers and introduced safeguards. One such safeguard is the no negative equity guarantee which is in place to make sure you’ll never owe more than the value of your home.
You’ll need expert equity release advice before you can go about releasing equity. It’s a regulatory requirement.
A qualified, specialist adviser will be able to guide you through all of the options available and find a plan to suit your needs.
Our Equity Release Partner
John Charcol is working with The Equity Release Experts, a nationwide network of qualified advisers, who’ll discuss all the options available and compare products from across the whole of the equity release market to find the best one for you. If they don’t think equity release is the right fit, or if there’s a more suitable option, they’ll give you all the information and help you’ll need to make a confident decision.
Your initial consultation with The Equity Release Experts is free with no obligation to proceed. If you decide to go ahead with an equity release plan, the advice fee of 1.99% of the amount released is payable on completion, subject to a minimum advice fee of £1,499.
Interested in learning more about equity release? Simply send us an enquiry or call us on 0330 433 2927 and a member of our team will discuss how we can help you.
Equity release is a type of lifetime mortgage which is a loan that’s secured against your home. Releasing equity will reduce the value of your estate and may affect your entitlement to means-tested benefits. You should always think carefully before taking out a loan against your property.
The Equity Release Experts is a trading name of TERE Advisers LTD, an appointed representative of Key Retirement Solutions Ltd, which is authorised and regulated by the Financial Conduct Authority. Registered in England No. 122691