More great news for the increasingly buoyant equity release market as Partnership re-enter with their Enhanced Lifetime Mortgage plan.
Specialists in impaired life annuitys; Partnership are now bringing their underwriting expertise to equity release schemes. The logic behind their offering, provides a bespoke underwriting event for each client looking to achieve a maximum equity release status. Their experience from the enhanced annuitys market has led to a radical re-think in the equity release market where effectively the same principles can apply.
Consideration for impaired life equity release schemes is certainly gaining momentum as rumour has it other equity release companies such as Aviva may also be looking into the possibility of developing their own impaired product. In fact any of the existing equity release providers who offer an annuity proposition could be in the market with potential launches under their wings?
So what is an impaired life equity release scheme?
Well firstly lets have a look at how an impaired life annuity works…
Primarily, an enhanced annuity provider will ask the annuitant a series of health questions which dependent upon their health conditions & severity, will determine the size of the annuity pension they will receive. In essence, the worse their health is the better, as they will potentially receive a more sizeable pension due to their life expectancy not being as long as a healthy person.
It may sound crude, however Partnership’s years of underwriting experience allows them to now offer the same principles in the equity release market by offering a bigger lump sum than standard equity release providers. The maximum release, dependent upon the health questionnaire is 55% of the property value.
What illesses will qualify?
The questionnaire itself is not as detailed as one would imagine. Likewise the number & severity of the qualifying conditions is lower than expectations, thus making the underwriting aspect of the equity release plan simplistic in assessment.
The health questions are as follows:-
- Have you smoked 10 cigarettes per day for the last 10 years?
- Have you been diagnosed with high blood pressure, requiring ongoing medication?
- Have you suffered a heart attack requiring hospital admission?
- Do you suffer from diabetes, requiring insulin or tablet treatment?
- Have you suffered from a stroke (CVA), excluding mini-strokes (TIAs)?
- Have you suffered from angina, requiring ongoing medication?
- Have you been diagnosed with cancer requiring surgery, chemotherapy or radiotherapy?
- Have you been diagnosed with Parkinson`s disease?
- Have you been diagnosed with multiple sclerosis?
- Have you taken early retirement on the grounds of ill health?
- Are you currently taking any prescription medication?
Given this information, the online Partnership equity release calculator will then produce a maximum lending figure taking also into account age(s) & property valuation. A signature will then be required on a declaration form to confirm the medical questions have been correctly answered as only a sample number of applications will actually be looked into with the clients general practioners. This makes the application process quicker & smoother putting the onus on the applicant accurately qualifying their ailments.
Are their any other features in Partnership’s enhanced lifetime mortgage scheme?
The simple answer to that is yes.
Partnership have managed to squeeze in some important features that provide additional security & protection for applicants. Aside from being a member of SHIP & thus passing the protection features of the no negative equity guarantee, assured tenancy & ability to move home, there is also an Inheritance Protection facility.
The inheritance protection feature is included at no extra cost & provides the ability to protect a part of the final sale proceeds which can then be successfully passed onto the heirs & beneficiaries. Therefore, peace of mind reigns when the biggest objection to the use of equity release schemes is ‘how much will be left for the children when I die’.
What is their lending criteria?
The Partnership Enhanced Lifetime Mortgage is currently only available in England & Wales on property valuations over £70,000. Their approach to property types is standard amongst the industry, although they will permit borrowings on some concrete build constructions such as Laing Easy Form & Wimpey No Fines which down to the valuers comments would pass as acceptable.
The minimum age of the youngest applicant must be 60 & at least one suffering from one of the aforementioned illnesses/conditions. The minimum loan on application is £25,000 which is higher then most equity release providers, however the plan is pitched at the higher release end of the lifetime mortgage market.
The major factor setting themselves aside from the alternative impaired life equity release offering from more2life is the FREE cost to market for any applicant. Partnership have initially launched with a tempting proposal of a FREE valuation & NO application or completion fee payable on set up. In fact they even go one step further with a CASHBACK of £250 on completion which goes some way to offsetting any legal fees incurred.
Again, thanks to companies such as Partnership showing innovation, the equity release market has shown its durability over the past 12 months at a time of economic diffculties. Perhaps the old days when the two words – ‘equity release’ & ‘apprehension’ were associated, are now becoming more of a distant memory.
If you would wish to find out whether you would qualify for an enhanced lifetime mortgage with Partnership, please fill in this Partnership enquiry form or call freephone 0800 678 5159.