Many people who are looking at equity release often get confused about some of the product features on offer. Some would appear at first sight to be just a marketing ploy. Others have some real benefits for you.
The list below highlights some of the key terms used by the equity release companies. Check them out and see which ones are important to you.
This allows clients to make ad-hoc or regular repayments. These are typically up to ten percent of the initial loan each year. They usually come with no early repayment charge (ERC). This feature will help you to minimise the build-up of interest. You can even reduce the loan over time.
This will allow you to withdraw money in stages rather than taking a single lump sum. This can help to keep costs down as interest is only applied when it is withdrawn.
It reduces the maximum loan amount but enables a fixed percentage of the property value to be ring-fenced as a minimum inheritance. This is regardless of the total interest accoutred by the loan.
Early repayment charges which are a fixed percentage of the initial loan during a set period of time. Typical, they decrease on a sliding scale. Once the fixed period has ended you can repay the loan in full without an ERC
This will allow you to downsize to a smaller property and repay the loan. This can be either voluntarily or if the new property does not fit the providers’ criteria, without incurring an ERC. In addition, typically there is a qualifying period of five years before the feature applies.
Sheltered/age restricted accommodation
Your equity release mortgage can be secured against sheltered or age-restricted properties. This would be subject to the provider’s specific criteria at the time.
This allows for either full or partial interest repayment to be made each month by you. Also, it will either stop or reduce the interest being rolled up on to the loan. Remember that there is no risk of repossession if payments are missed as you can stop the monthly repayments and revert to the interest rolling-up at any time.
The Equity Release Council
The above definitions have come directly from “The Equity Release Council”. Anstee & Co and our equity release advisers are registered with them. This ensures that you receive the highest standards within the industry.
How can Anstee & Co help you with Equity Release?
As a homeowner, your property is probably your biggest asset. Releasing the cash that has built up in your home should not be taken likely. This is lifetime mortgage. It may affect your entailment to state benefits and will reduce the value of your estate. You need to be over the age of 55 and a United Kingdom homeowner.
To find out is equity release is right for you why not arrange an appointment with one of our expert advisers.
We have offices located in-
Birmingham, West Midlands
London, Central London
Furthermore, our expert advisers also make use of meeting rooms in, Bedford, Northampton, Towcester, Wellingborough and Droitwich.
Finally, the first fact-finding meeting is free and without obligation so why not contact us today to find out more?