The answer to this varies from lender to lender & dependent on the how the advice has been sourced.
However, the main breakdown of costs in setting up equity release schemes can be categorized as follows:
- Valuation Fee - This cost is the only upfront fee that would be charged by the lender. It is dependent on the value of the property & the equity release company selected. Always check whether there are any incentives available as some providers will waive the valuation fee on application
- Lender Application Fee - Typically this can range from £500 to £695 dependent on the equity release company. This is usually deducted on completion, however some lenders will add this to the amount released.
- Telegraphic Transfer Fee - Incurred & charged when the funds are transferred from the lender via the banking system to your solicitor. Varies from £30 to £60.
- Legal Fees - A solicitor is required to act on your behalf & it is advantageous if your solicitor is experienced in dealing with equity release plans. You are advised to seek independent legal advice & that is separate from that of the lenders (SHIP rules). Again costs can vary substantially between solicitors setting up an equity release plan. However, Equity Release Supermarket have negotiated competitive and fixed legal costs on clients behalf with solicitors who are specialists in this field (we can keep these costs down to £295+VAT+disbursements – typically £400-£450)
- Advice Fee – This is dependent on how the advice has been sourced as the financial adviser may charge a fee for their services. Typically fees are from £595, with companies even charging a minimum of £795 or 1.5% of the release, whichever is the lower. Obviously,costs can vary significantly & research is all important as this will impact on the net cash sum you receive.
It is imperative that independent financial advice is received. With over 20 providers in the equity release market & individually each having many schemes, the market is complex & ever changing.
Advisers from Equity Release Supermarket can establish the best scheme for you by having access to the whole of the market, dealing on a daily basis with these providers & obtaining exclusive deals not available to the general adviser network.
Telephone 0800 783 9652 for further information.
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