IS Equity Release the right thing to do? When you’re considering Equity Release, it’s vital you are getting the best advice and the best service possible. This is a big decision so taking advice from one of our independent mortgage brokers is really important.
Before applying, whether that’s for a lifetime mortgage, or a home reversion plan, make sure to speak to us – equity release lenders insist borrowers have sought financial advice.
Equity Release is a financial scheme usually restricted to those homeowners who are aged 55 and over. It allows homeowners to unlock the value of your home and turn it into cash for you to spend however you choose to. You can access the cash either as a lump sum or in instalments (otherwise referred to as drawdown). Whichever way you decide to do it, we’ll make sure it’s the right way.
An extremely important question you’ll ask yourself, and your broker, is whether or not Equity Release the right thing for you to do? The answer of course is this will depend on your needs and circumstances.
Is Equity Release The Right Thing To Do
There are two main types of equity release schemes:
• A lifetime mortgage
• A home reversion scheme
A lifetime mortgage, or equity release mortgage, is a type of loan secured against your home and means you retain ownership of your home. In contrast, a home reversion scheme involves you selling all or part of your home to a home reversion company.
Each of these schemes has different properties which make them more or less suitable for you, depending on your individual circumstances. Your independent broker at Worldwide Financial Planning will help you assess which will be the best for you in terms of the benefits and the costs involved.
It may be that you and your broker decide that equity release is not suitable for you and you may have some better alternatives, such as:
• Selling your current home and downsizing to free up some capital. You would of course need to weigh up the costs of moving to make sure they were outweighed by the money you would receive.
• If you need to make improvements and are considering equity release as a way of paying for them, you may be entitled to grants for this kind of work.
• Try doing a benefit check – there may be some benefits, such as pension credit, that you are entitled to.
• You may have lost bank accounts or lost pensions that you can track down. The Pensions Advisory Service runs a pension tracing service to help you do this.
• You may be able to organise your savings and investments to produce some more income for you or a lump sum instead of entering into an equity release scheme. There may be more cost effective and tax efficient ways of organising these and your broker will help you do this.
Whatever you need, we’ll help you achieve it. Our independent brokers will look after you every step of your Equity Release journey. We are qualified to advise you on all equity release schemes. Be smart about Equity Release – email info@wwfp.net and let’s work together to unlock some of the value of your home. To read more on Equity Release, read this column by our CEO Peter McGahan.