Equity Release

Equity Release can be a great way to access the money locked in your home, but is it right for you?

For Peace Of Mind We Only Refer You To Advisers Who Advise On Equity Release Products From Providers Who Are Members Of The Equity Release Council

Equity Release Coucil Logo

On this page, we’ll share some information to help you understand more about Equity Release. If you would like to speak with with an expert, we can get you in touch with your personal consultant. 

Robin Mortgage Design act as an introdcuer to a panel of Lifetime Mortgage and Equity Release Advisers. Whilst we do not offer this advice directly, we will fisrtly have a conversation with you to find out more about your circumstances, if you then need equity release advice, we will refer your contact details onto a specialist third party, who will get in touch to further explore your options.

What Is Equity Release?

Equity Release is a type of lifetime mortgage. This means the mortgage has no end date, therefore would be in place until death or moving out of the property. An Equity Release mortgage allows you to release equity from your home for many different uses, which we cover late on.

So what is equity? Well in simple terms, equity is the value of your home less any secured debts, such as mortgages or other loans. For example, if your home is worth £500,000 and you have a mortgage of £100,000 then your equity is £400,000.

7 Common Facts About Equity Release

  1. To qualify for an Equity Release Mortgage the minimum age set by providers is 55.
  2. You could receive a guaranteed tax-free cash sum or income.
  3. You can continue to live in your home for as long as you wish.
  4. There are typically no repayments required. This means that the interest will build up over time.
  5. You will only have to repay the loan, if the property is sold, you enter long term care or upon death.
  6. You have the freedom to move to a suitable property should you wish to do so in the future and transfer your equity release plan to your new home subject to the lenders property criteria.
  7. Your estate will not be liable for any debt beyond the property value regardless of future house prices.

I Have Heard Bad Things About Equity Release

It’s not uncommon for people to have a bad perception of Equity Release or to be worried about the long term costs. However, over the years Equity Release has been and continues to be monitored closely by the Financial Conduct Authority and advisers have to consider what Equity Release really means and whether it’s suitable for you.

Our trusted partners will review all your options, including conventional First Charge Mortgages, Retirement Interest Only and Equity Release. They will explain the positives and negatives of each and ensure you have all the time you need to make the right decision.

What About My Equity, Could I loose It All?

Firstly this will depend on the type of mortgage you take, as to how much equity you could loose, if any. A conventional mortgage or a Retirement Interest Only Mortgage will insist that the interest is paid monthly, so no further equity in the property is lost. If you choose an Equity Release mortgage, then typically there are no monthly repayments, this means that the interest will build up over time and reduce the amount of equity in the property.

With an Equity Release Mortgage, Interest is typically added to the loan for the lifetime of the mortgage and will accrue interest. However, most Equity Release products now offer something called ‘No Negative Equity Guarantee’. This will ensure that you never owe more than the property is worth and some providers will allow you protect a portion of the equity by way of an ‘Inheritance Protection Guarantee’, such as 20%, so you always have some equity in the property.

When provided with your personalised illustration, make sure you understand the whole document as this will explain what is, or not protected.

Is Equity Release Safe?

As discussed earlier, the later life lending market has had many industry eyes looking closely into the products. The Financial Conduct Authority, has put in place new regulations over the years to ensure that the market remains fair and transparent. Based on this, it is therefore fair to say that the equity release market is safer today than it has ever been.

The market is also protected by an industry body known as SHIP (Safe Home Income Plans). Set up in 1991, SHIP is dedicated entirely to the protection of plan holders and promoting only safe equity release products.

On top of this all advisers must hold specialist qualifications and be able to demonstrate a level ongoing professionalism.

Finally there is the Equity Release Council. They are an independent body, where all reputable providers and advisers agree to a level of service above the normal regulatory requirements. This means that providers that belong to the Equity Release Council offer a number of Guarantees and Safeguards which we have listed below;

  • Secure tenure Customers can remain in their property for life or until they move into long-term care provided it remains their main residence.
  • No negative equity guarantee A customer will never owe more than the value of their home and no debt will ever be left to their estate.
  • The chance to move home As long as the new property is acceptable to the provider.
  • Independent legal advice Ensuring the customer fully understands the risks and benefits of the plan.
  • Fixed interest Lifetime mortgage interest rates must be fixed or capped for life.
  • Clear information Customers will be provided with fair, simple and complete presentations of their plans

Hopefully this will put your mind at rest, as we believe that Equity Release can be a fantastic option, when advised correctly and the last thing we want, is for you to make the wrong decision.

Are There Other Features That I Should Know About?

There are many features to an equity release mortgage which your dedicated adviser will explain to you, however, three common features are Impaired Life, Flexible Drawdown & Interest Serviced

‘Impaired Life’ means that you might be able to borrow additional funds, if you have one of the medical conditions listed by the provider. This is usually because you will have a reduced life expectancy, meaning the risk to providers are reduced. The amount of additional funds that you could raise will depend on your medical history and age at application.

‘Flexible Drawdown’ means you are pre-agreed a set value of money that can be released from the property. The good news is that you do not have to draw all the funds down at once, you could do this over a number a years. Think of this like a bank overdraft, you might never need to use the funds, but if do, they are available to you. A benefit of a product offering this facility, is that you wont pay interest on the funds until they are drawn out the property and you don’t have to draw them, if you do not need to.

‘Interest Serviced’ means that you will pay the interest due each month. This is great if you do not wish the balance owed to increase each month.

Is Equity Release Right For Me?

This is an excellent question and one that you should be asking, all the way through the process of applying for yours.

To help you make that decision we have taken the time to explain some points that should given serious consideration, before you even make the call to us;

  • Are you happy that you are releasing equity in your home that could build up interest over time and significantly reduce the amount of spare equity.
  • Releasing Equity in your home, could affect your overall wealth, which could impact on inheritance being passed, or access to benefits.
  • Have you considered your income and whether a conventional mortgage or Retirement Interest Only Mortgage would be serviceable and more practical.
  • Could you liquidate other assets that provide the amount you require.

Equity release isn’t right for everyone which is why, when you deal with one our trusted Partners, you wont feel rushed or pressured and be given all the positives and negatives. You will also be advised to seek independent legal advice about what Equity Release means and where appropriate be directed to Citizens Advice Bureau on other matters such as state benefits.

Why Use A Equity Release Broker?

This is a really good question. Equity Release Brokers have access to the widest range of products, not just equity release.

So, if you would like honest, unbiased advice, suited solely to you, then a broker is just what you need.

Ready to get in contact? Fill in our simple form or speak with a mortgage adviser directly by using the details below.

Call us

0330 242 8363

After you have registered your interest, one of our consultants will be in touch to discuss your options and where appropriate, make a formal introduction to to a specialist third party . There may be fee payable which will be confirmed to you by them.

Please see Terms & Conditions

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

Equity release includes Lifetime Mortgages and Home Reversion Schemes. The specialist third-party we will introduce you to is only able to advise on and arrange Lifetime Mortgages, and will refer to an approved specialist for Home Reversion schemes’

The information contained in this website is subject to UK regulatory regime and is therefore intended for consumers based in the UK.

Not all forms of mortgage lending such as certain Buy to Lets are regulated by the Financial Conduct Authority along with some additional related services, such as Conveyancing. A full disclosure document will be provided to you.

If you are considering securing additional debts against your home: Think carefully about securing other debts against your home. Your home may be repossessed if you do not keep up repayments on a mortgage or other debt secured on it.

Some links on this website will take you to third party websites. Robin Mortgage Design have no control over and are not responsible for the content of other sites.

*some services are by provided as a referral to a third party company. No personal information will be shared with such companies without your prior permission. Robin Mortgage Design have no control over these companies and cannot be held accountable for their service or advice.

Robin Mortgage Design is a trading style of Robin Partnership Ltd whom is an appointed representative of HL Partnership Limited, which is authorised and regulated by the Financial Conduct Authority.  The registered Office of Robin Partnership Ltd is 22 South Street, Castlethorpe, Milton Keynes, Buckinghamshire, MK19 7EL. For more information please refer to the FCA register https://register.fca.org.uk

Robin Mortgage Design charge a broker fee which is only payable on mortgage offer. The precise amount will depend upon your circumstances however a typical fee is £395.00 and the maximum that could be charged is £1,495.00

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