EQUITY RELEASE

There are thousands of people, who like you, find themselves in an “asset rich cash poor” situation, which has led you consider releasing equity from your home

An Equity Release mortgage might be the answer if you are looking to stay in your home and need to carry out much needed alterations, long awaited home improvements or essential repairs, giving you a better quality of life.  

 

The alternative to an Equity Release Mortgage may be sell your house and downsize however, the financial costs of doing this can be high with estate agents fees, removal costs, legal fees and possibly stamp duty, not to mention the emotional upheaval and hassle of leaving your home where you may have lived for many happy years.  

 

Moving to a new home may also require you to leave an area that is well known to you and therefore lose contact with friends and neighbours, and your existing social circle.

You may be simply wanting to release a cash lump sum to help you live the life you want, to provide you with an Income, or maybe to finance a long-awaited holiday, buy a new car, meet an unexpected expense or perhaps provide a cash payment to your loved ones to help pay towards a deposit, enabling them to step on the property ladder and buy their own home.

Another consideration may be to clear an existing Interest Only mortgage that is coming to an end

Following a number of recent changes, Equity Release Mortgage lenders are now able to offer a variety of products to suit different needs, these include:

  • no monthly repayments, where the loan and interest is “rolled up” 

  • the option to pay the interest each month

  • some providers allow you to withdraw smaller amounts on a drawdown basis, rather than one large lump sum

  • Many lenders offer a fixed rate of interest 

  • Mortgage based schemes under the Equity Release Council provide a No Negative Equity Guarantee ****

  • You may be able to have the option to increase the amount you have borrowed as and when you want to, up to the maximum limit agreed with your provider

The Advantages of an Equity Release mortgage
  1. No monthly payments are required on a roll up scheme

  2. You are guaranteed to be able to remain in your home for the remainder of your life or the mortgage comes to an end *

  3. You can choose to receive your funds in a lump sun or in smaller, regular amounts

  4. You are able to obtain additional finance without moving to a new house

  5. You retain ownership of your home

  6. You may continue to benefit from any rise in the value of your property

  7. Any equity you release from your home is tax-free.

 

You can normally borrow up to 60% of the value of your property. How much can be released is dependent on your age and the value of your property. The percentage typically increases according to your age when you take out the lifetime mortgage, while some providers might offer larger sums to those with certain past or present medical conditions.

Equity Release schemes have been around for more than 30 years, however some products taken out back in the 1980s proved to be problematic.  In 1991 The Equity Release Council was launched.  This is an organisation created to promote safe equity release products and to safeguard the interests of homeowners. Louise only works with Equity Release Mortgage Lenders that are members of the Equity Release Council 

You should consider that taking an Equity Release Mortgage may reduces the value of your estate and may affect any means-tests benefits you’re eligible for now or in the future.

 

You need to be a homeowner and the youngest applicant needs to be aged at least 55 years old to qualify. 

* An Equity Release mortgage comes to an end when the first of the following happens: -

  • You decide to sell the property (you may be able to transfer the mortgage to a new property) or

  • You permanently move into a long-term residential care home ** or

  • If you die ***

** if your property is owned jointly, the mortgage will continue if only one of the owners moves permanently into a long-term residential care home

*** if the property is owned jointly, the mortgage will continue until the death of the second owner.

**** Products which fully meet the Equity Release Council’s Product Standards are required to feature a “no negative equity guarantee”.  

 

Put simply, this guarantee means that you, or more specifically, your estate will never owe more than the property is worth when it is sold.

Under your equity release plan, you have the right to live in your home until you need to move into a smaller property (whereby the plan may be transferrable), or move into permanent care, or until death. Your property will be sold, and the sale proceeds will be used to repay the money owed to the provider of your plan. Any money left over, at the end of your plan, will be paid to you or your beneficiaries, in accordance with your Will.  

 

In the unlikely event that the value of your house has decreased significantly, it is possible that it might not be worth enough to cover the amount which you owe.  The “no negative equity guarantee” means that if this turns out to be the case, the remainder of the loan would be written off.

An Equity Release may not be the right mortgage for everyone, but for some people it can be a lifeline.  

Louise will be able to find the right equity release Mortgage to suit you.  Louise does not charge for an initial no obligation meeting.  

AN EQUITY RELEASE PRODUCT WILL REDUCE THE VALUE OF YOUR ESTATE, WILL NOT BE SUITABLE FOR EVERYONE AND MAY AFFECT YOUR ENTITLEMENT TO STATE BENEFITS. TO UNDERSTAND THE FEATURES AND RISKS PLEASE ASK FOR A PERSONALISED ILLUSTRATION.

LOUISE DANIELS MORTGAGE SERVICES

Louise Daniels Mortgage Services is an Appointed Representative of PRIMIS Mortgage Network which is a trading name of Personal Touch Financial Services Limited.

 

Personal Touch Financial Services Limited is authorised & regulated by the Financial Conduct Authority.

Contact

8 Kielder Close, 

Narborough, Leicester, 

LE19 3YW

Tel: 01162 869 131

Mobile: 07790 037617

Email: louise@ldmortgageservices.co.uk

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Louise Daniels Mortgage Services act as a credit broker not a lender.

Mortgage fee: I typically charge a fee of up to £370 with 50% of the fee upfront with the balance paid on completion.

We are not authorised to provide advice on Private Medical Insurance but can introduce you to an authorised and regulated Financial Adviser who can provide you with specialist advice in this area. The Financial Conduct Authority does not regulate Will Writing and Inheritance Tax Planning Advice.

 

The Financial Conduct Authority does not regulate most Buy to Let Mortgages.

The Financial Conduct Authority do not regulate conveyancing activities.

Wills are not regulated by the FCA and clients information can be passed to an outside company called Charlie Bridges Wills & Estate Planning Ltd. Information will only be shared to a third party with their permission. The Financial Conduct Authority does not regulate Will Writing and Inheritance Tax Planning Advice. These products are not regulated by the FCA and we are not authorised via PRIMIS Mortgage Network to advise on them.

© Louise Daniels Mortgage Services 2019

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