Compare Equity Release
If you are aged 55 or older and stuggling financially, you may be considering the option of equity release.
You may not know what ‘equity release’ means or what it entails.
Equity release is a way of extracting cash from the value of your home. This option may sound attractive, particularly to those so-called consumers who are ‘cash poor, asset rich’, but equity release may not be suitable for all consumers. For instance, such schemes can be both expensive and inflexible if your circumstances change in the future. In addition, equity release may affect your current or future entitlement to State or local authority benefits.
Things to consider
You shouldn’t automatically assume that equity release is the right option for you if you have substantial equity locked-up in your home. There may be other, cheaper options open to you to meet your financial needs. Things you should consider before entering into an equity release scheme include:
- Claiming any State or local authority benefits you might be entitled to, including the cost of home improvements;
- Using any existing savings or investments to meet your needs - but you should get advice before doing so since you may lose benefits or be penalised if you encash or sell certain investments early;
- Tracing any preserved pensions you may have lost track of, using the Pension Tracing Service; and
- Selling your home and downsizing to a smaller and cheaper home to release cash
If you would like to obtain advice on equity release and what options are open to you then there are a number of specialist advisers operating in the UK who can help you. Equity release is a specialist subject. Making sure you get quality advice from a reputable firm is of paramount importance to your financial future.
Equity release scheme providers and advice
Age Partnership provides specialist advice on equity release schemes for consumers aged 55 and over. Age Partnership has substantial experience in providing equity release advice and now arranges roughly one in ten of all equity release plans taken out in the UK each year. All advice is provided over the phone by specialist advisers.
In the UK there are three main types of equity release scheme available to consumers – lifetime mortgage, drawdown lifetime mortgage and home reversion plans . Age Partnership searches the UK market to source you the right equity release scheme for your circumstances. It has negotiated preferential rates with the leading equity release providers in the UK including Aviva, Prudential and Liverpool Victoria (LV=).
- Lifetime mortgage – this enables you to release a lump sum from the value of your home - the amount released plus any interest accrued on that amount is repaid out of your estate when you die or move into long-term care.
- Drawdown lifetime mortgage – this is similar to a lifetime mortgage, but with added flexibility. Rather than extracting a substantial lump sum up front, all of which you might not need in one go, you can gradually extract or ‘drawdown’ the cash over time as and when you need it. This option can reduce the amount of interest you pay compared to a standard lifetime mortgage.
- Home reversion plan – this enables you to surrender some or all of the ownership of your home in exchange for a lump sum of money and the right to remain living in your home, rent free, for as long as you live.
While equity release may not be suitable for all consumers and circumstances, it is widely expected that equity release will become an integral part of consumers’ retirement planning in the coming years as the value of pensions fail to provide the level of income consumers require during their retirement. Although property prices in the UK have recently fallen, the amount of equity locked up in consumers’ homes, particularly those over age 55, still runs into billions of pounds. One of the UK’s biggest equity release scheme providers, Aviva, expects the equity release market to double in size with almost £2.5 billion expected to be released each year by 2013.
Here are the key features and benefits of having Age Partnership provide you with specialist equity release advice:
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Age Partnership provides independent, unbiased advice to suit your individual needs and circumstances
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It searches and compares the UK equity release market and has negotiated preferential terms with the leading providers on behalf of its clients
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Advice is provided by a qualified equity release specialist
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All contact and advice with Age Partnership is provided over the telephone so there is no intrusive visit to your home
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It pledges to make your equity release experience as comfortable and effortless as possible
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Age Partnership provide a ‘No Negative Equity’ guarantee
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Free, no-obligation quotation – as noted above, equity release may not be suitable for all consumers and circusmtances – this is why Age Partnership offer a free, no-obligation quotation so that you have the opportunity to make an informed decision on your financial future
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Age Partnership is authorised and regulated by the Financial Services Authority, and you also have access to the Financial Services Compensation Scheme and the Financial Ombudsman Service should things go wrong
