Equity release lifetime

Equity release lifetime

Equity release lifetime products are specialist mortgage products within the wider mortgage industry, designed to enable elder homeowners to secure their financial status for their remaining days. Equity release lifetime packages are only available for individuals over the age of 55, with different packages only suitable for individuals. Equity release lifetime products are not suitable for everyone however, and considerable thought should be given to any deal. Our advisers are specialised in achieving the most appropriate form of equity release lifetime products for each unique individual.

Individuals are likely to choose from two main equity release lifetime products, of which there are different forms: lifetime mortgage or home reversion. Both of these products guarantee individuals the security of living within their own home until death or moving into a care home, although there are key differences between the two main products.

Lifetime mortgage equity release lifetime mortgage deals to withdraw a mortgage product which only allows the mortgage provider to seek payment when the individual dies or is moved in to a permanent residential care home. Equity release lifetime mortgage products can come in interest only, interest rollover, home income plan or shared appreciation form, with each of these individual products needing to be analysed holistically to see if it is the right deal for an individual’s needs and requirements.

In addition to equity release lifetime mortgage products, home reversion mortgage deals can also be sought by individuals. Home reversion plans are similar to lifetime mortgage solutions in the idea that the individual can live in their home until death or moving in to a care home, yet they differ in their principles. A home reversion plan will enable the current homeowner to receive a lump sum of money, which is non repayable, under the circumstances that the provider buys shares or part of the house involved. No monthly payments are required with the future of the property certain at the start of the contract; however, there is a psychological issue for many individuals owning their property and subsequently only becoming the tenants of the property involved.

It should be noted that individuals can obtain the finance required from their equity release lifetime mortgage product in different forms. Individuals can obtain a lump sum, undertake a drawdown mortgage option, or alternatively see a fixed income or an income in line with inflation to help their day to day cost of living.

It should be noted that equity release lifetime products are not for everyone and careful consideration should be given when looking to obtain one of these specialist mortgage products. Individuals may find it more financially viable to move home and scale down to release extra finances, ask for a loan from friends or family, or alternatively seeking a grant from the Home Improvements Trust if the aim of equity release will be to improve their home. All individuals should be clear for their reason in obtaining equity release within their property and a hap hazard approach should certainly not be taken.

It should also be noted that individuals receiving state benefits may suffer from undertaking an equity release lifetime deals. The extra income received from an equity release lifetime product will boost an individual’s income and is likely to be taxed, whilst at the same time may result in the loss of pension credit, savings credit and council tax benefit for an individual on the means tested benefit system. By consenting to our assistance, our advisers will seek the best possible option for the individual and also look for other alternatives, rather than equity release lifetime products, to benefit the individual’s needs.

If individuals are looking to free up extra finances to help assist with holiday plans, to create immediate finances, to pay for healthcare or to help a member of family, equity release can be a suitable, sustainable and necessary financial step for individuals and should be pursued. Under the Safe Home Income Plans scheme, individuals will not move in to negative equity from any equity release lifetime product as a guarantee, enabling the individual’s family to not suffer in the long term from the undertaking of any equity release lifetime product. Our advisers thrive on finding the most convenient equity release lifetime product to revolve around the borrower’s future plans and aspirations.

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This is a lifetime mortgage. To understand the features and risks, ask for a personalised illustration.