House Equity Release Pensioners

House Equity Release Pensioners

House equity release pensioners are mature individuals looking to acquire a house equity release mortgage, in order to free extra finances to support their financial situation, or alternatively contribute to personal ambitions. House equity release pensioners must be over the age of 55. We have a team of specialist advisers who are dedicated in seeking a suitable form of mortgage arrangement for clients who are considering the prospect of becoming house equity release pensioners.

An equity release scheme can only be ended on the condition that the borrower dies, or is moved to a care home due to declining health. House equity release pensioners are able to choose between two key equity release products; either a lifetime mortgage or a home reversion plan.

Lifetime mortgages require house equity release pensioners to withdraw a mortgage, with the intention of repaying the full amount borrowed back to the equity release provider. A lifetime mortgage can be divided into three alternative sub-schemes; interest only, interest rollover, or home income plans.

An interest only scheme enables house equity release pensioners to repay the debt of the mortgage at the end of the term of the arrangement. However, this does not mean house equity release pensioners are exempt from issuing monthly payments of interest to the provider. An interest rollover scheme does not require house equity release pensioners to make any payments throughout the duration of the contract, yet interest rates are calculated every month and attached to the mortgage. Home income plans work by providing house equity release pensioners with an annuity (a lifetime income), which will enable them to repay monthly instalments of the mortgage and interest costs.

Lifetime mortgages may be useful, as the borrower retains full ownership of their property. However, lifetime mortgages consist of a number of disadvantages; for instance, interest rates that are free to vary may lead to spiralling debt if interest rates ascend. Younger borrowers are likely to have a higher build up of debts, due to a longer life expectancy, which allows interest more years to rollover. It may be difficult to assess whether a lifetime mortgage is an appropriate option for an individual, however our team of specialist equity release advisers ensure all house equity release pensioners will be suited to a beneficial and cost-efficient form of lifetime mortgage.

A home reversion plan is another scheme available to house equity release pensioners. This plan works on the principle that the plan holder obtains a lump sum of cash, which may be used to their own intentions. As an exchange, the provider is permitted to a proportion of the property share. A full home reversion plan enables to provider to takeover full ownership of the property, whereas a part home reversion plan enables the plan holder to maintain a proportion of the share of the property. The plan holder is also guaranteed occupancy to their residence for life.

It must be stated that equity release plans are not suitable for all clients, as the arrangement may result in further financial difficulties.
Home equity release pensioners may be left with a substantial debt, which in turn could result in severe penalties. Our team of specialists are qualified in assisting clients find a suitable, cost effective home equity release mortgage product.

Looking to become a house equity release pensioner? Contact our team of specialists today.

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

CHECK THAT THIS MORTGAGE WILL MEET YOUR NEEDS IF YOU WANT TO MOVE OR SELL YOUR HOME OR YOU WANT YOUR FAMILY TO INHERIT IT. IF YOU ARE IN ANY DOUBT, SEEK INDEPENDENT ADVICE.