The first Equity Release Supermarket video released on the subject of equity release & equity release schemes available – http://www.youtube.com/watch?v=RpkMb4LWOsc
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To contact the team ring freephone 0800 783 9652
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Check out the new video from Equity Release Supermarket
Monday, December 6th, 2010Equity release – An excellent way to improve your finances
Tuesday, November 30th, 2010There are many retired people who cannot find th quality of life they yearn for on the limited savings and small pensions they have. If you are suffering from financial difficulties then equity release can be the perfect solution for you. Equity release allows you to unlock money against the value of your home.
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How does equity release work?
To qualify for equity release, you must be above 55 years old and own a home which is worth more than £60,000. Once you have opted for equity release, you will receive a lump sum amount of money or monthly income from the lender.
If you have decided to go for equity release then you must know that there are two different equity release schemes in the market.
Lifetime mortgages – These schemes are preferred by many homeowners these days because they can be provided in different formats to suit people’s circumstances. The different types of lifetime mortgages range from lump sum equity release to the flexible drawdown equity release schemes. The lump sum plans do as the name says on the tin, in that they provide a single, one-off lump sum which is fine if no further cash releases are required.
However, this can be difficult to predict & when interest rates for the lump sum & drawdown are the same then invariably the drawdown plans are the most popular equity release schemes available.
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Home reversion plans – These equity release schemes allow you to sell the whole or only a percentage of your home to the home reversion lender. This means that you have the option to also keep some part of the property for your beneficiaries. These are the only type of equity release schemes that can guarantee an inheritance for your beneficiaries.
Both the above mentioned equity release schemes are regulated by SHIP (Safe Home Income Plans) and the FSA (Financial Service Authority). These organisations ensure that all the applicants get the protection that equity release UK schemes should receive in getting the appropriate deal for your circumstances.
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To ascertain which or how either of the aforementioned equity release schemes can benefit you, please contact Mark Gregory on 0800 678 5159 or email mark@equityreleasesupermarket.co.uk
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More Great News For The Equity Release Market As New Life Mortgages Return With Lowest Interest Rate
Wednesday, November 3rd, 2010Signs are certainly showing of a recovery in the equity release market as news that existing SHIP member – New Life Mortgages are returning with two new competitive products.
They arrive on the back of the recently launched impaired life equity release lender; more2life at the beginning of October.
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Although New Life Mortgages hadn’t officially withdrawn from the market in 2009, it remained in the market whilst new funding sources were explored..
That time is now & details of the revamped equity release schemes can also be found on the Equity Release Supermarket website by clicking here.
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New Life Mortgages have decided to make a statement, by not only relaunching their product range, but also arriving with the lowest interest rate in the market at just 6.35% monthly.
The Lifetime Fix and Lifetime Gold products both position themselves into the ‘roll-up’ lifetime mortgage range & are designed to be the most competitive equity release products in the market for the over-55’s.
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The New Life Gold product is designed to offer the maximum release possible for a client in good health. Plans start at age 55, with a release of 20%, thus offering the maximum release currently available in the equity release market.
The age related percentage’s that can be released are as follows: -
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Age 55 – 20%
Age 60 – 25%
Age 65 – 30%
Age 70 – 36%
Age 75 – 41%
Age 80 – 46%
Age 90 – 51%
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The product is uniquely available only on a single life basis & has a very competitive interest rate of 6.75% monthly. This compares favorably with its peers at the maximum release end of the market who would be Aviva & new entrant more2life.
As an extra incentive, New Life Mortgages are offering £300 cashback on NLM Gold cases that complete prior to December 29.
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The Lifetime Fix is the second product on offer from New Life Mortgages with the lowest rate currently available in the equity release market at just 6.35% monthly.
Available on a single & joint life basis the plan releases a lower amount than the Gold product, starting with a release of just 17% of the property value at age 55.
As an added incentive New Life are offering £600 cashback on cases completed before 29th December, so if you are considering equity release with a low interest rate hurry!
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Both schemes have a minimum acceptable property value of £60,000, which again is the lowest in the equity release market & may bring previously ineligible applicants a new lease of life?
If early repayment charges are an issue with some lenders relying on gilt rates, New Life Mortgages have a more conventional attitude with the simplistic rate of a 5% penalty in the first 5 years. Thereafter no penalty exists.
This could obviously favour people who may have shorter term retirement plans with their properties, although equity release UK schemes are designed to run for the rest of your life.
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Should you require a product fact sheet or quotation on any of these New Life Mortgage products, please call the Equity Release Supermarket team on 0800 678 5159 or email mark@equityreleasesupermarket.co.uk
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Equity Release Schemes – the main types of lifetime mortgages
Wednesday, July 28th, 2010Would you like to have a secure and enjoyable retirement?
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If your answer is yes, then an increasingly effective option for the over 55′s is using equity release schemes.
We all have different financial needs & the more recently developed equity release schemes are designed to meet these requirements. These schemes are incorporated within the lifetime mortgage schemes and reversion plan product range.
From this selection the roll-up lifetime mortgage scheme is preferred by the majority of people.
A lifetime mortgage scheme is specially designed for homeowners who are entering retirement and want to release equity from their home as a secured loan. Under this equity release scheme, the repayment takes place on death or the client moving into long term acre.
Once you have opted for this scheme, you can continue living in the same residence for the rest of your life, even if the equity release balance become more than the value of the house. This is due to the inclusion, at no extra cost, of the no negative equity guarantee. This ensures that no debt, over & above the property value can be passed onto the beneficiaries.
Reassurance is therefore given to the children that they cannot incur debt by the actions of their parents.
This rule is a condition of all lenders that are members of the equity release trade body – SHIP (Safe Home Income Plans) who provide consumer protection in the equity release marketplace.
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In Summary
A lifetime mortgage scheme can divided into the following types.
- Roll-up lifetime mortgage
- Fixed payment lifetime mortgage
- Interest-only lifetime mortgage
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Roll-up lifetime mortgage – Under this kind of scheme, you do not have to pay any interest or repayments for rest of your life. The interests will be compunded yearly onto your actual loan amount and it will be paid when the home is sold on death or moving into long term care.
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Fixed repayment lifetime mortgage – In this scheme, there is no interest added to the actual amount but you have to payback a fixed amount when your home is sold. The scheme remains the same even if you sell your home after six months or 25 years, hence it is always important you receive independent equity release advice. This equity release is currently offered by Just Retirement.
The maximum charge that can be secured is 75% of the property value. The value of the overall facility is determined by several factors including your ge, sex, property value & your health & lifestyle situation. Click here to request further details on this unique equity release scheme.
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Interest-only lifetime mortgage – People who do not want the build up & compounding of interest can choose to make monthly repayments of interest only. Using this method, no interest is added onto your main loan as any interest generated is repaid back on a monthly basis.
Before choosing a type of lifetime mortgage, you must consider your post-retirement income and what your needs will be.
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To discuss any of the above issues please contact Mark Gregory on 0800 783 9652 or visit the Equity Release Supermarket website at http://www.equityreleasesupermarket.co.uk
Getting professional equity release advice is important
Thursday, July 22nd, 2010Are you over 50 and retired? Are you looking for a way to generate income after your retirement? If your answer is yes, opting for an equity release plan can be a good solution. Equity release advice from a reliable source can be helpful, especially for those homeowners who seek to access the value that have locked into their home.
Life after retirement should be enjoyable. And equity release is an option that individuals can use for different purposes including:
• Holidays
• Purchasing a car
• Home improvements
If you are looking at an equity release scheme, seeking the right professional advice is important. Taking professional help can help you to get the best deal.
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Why seek professional advice?
Equity realise schemes are of two different types, namely the home reversion plan and the lifetime mortgage. Selecting an appropriate arrangement to suit your needs is very important. With the right professional equity release advice, you will have a deeper understanding about the obligations and commitments you agree to.
As the value of your assets will be reduced with equity release, there will be a decrease in the inheritance your family will get. Moreover, as there are certain criterions you need to fulfil as part of the equity release scheme, professionals will help you determine whether you are eligible for the scheme or not.
If you are serious about equity release and want to get the best deal, make sure that you seek professional advice.
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With over 30 years combined equity release experience, Equity Release Supermarket advisers have the knowledge & experience to provide quality, independent advice.
For further advice call 0800 783 9652 today.
2 types of equity release schemes – Which one is right for you?
Monday, July 5th, 2010Equity release is a form of mortgage, which allows homeowners who are older than 55 years to release some equity from their property. This scheme is perfect for people who have no or little mortgage and want some more money to improve their lifestyle. If you own a property and you are over the required age limit then equity release is an ideal option to raise specific sums of money.
One of the best features about equity release schemes is that they offer tax free money which can be used for various purposes.
First of all, any mortgage that current exists must be repaid from either the funds raised via the equity release, or from any savings that exist. It is obviously essential therefore that you seek independent financial advice to ascertain whether enough can be released in order to complete this.
The Equity Release Supermarket calculator can assist in this respect by working out the maximum release possible.
Once this assessment has been done once, the tax free lump sum can then be used to spend on anything. Thus, you could opt to use the money to pay for any home improvements or repay debts such as credit cards or loans which can then be cleared immediately. There are many people who buy a second home or motor homes including caravans with this money.
You can even choose an option through which you will receive the money on a monthly basis, similar to a monthly wage or pension. This equity release scheme is beneficial for people who want to improve income in their retirement.
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If you have decided to opt for equity release then you should know more about two types of equity release schemes:
Lifetime mortgages – This type of scheme is known to be a secured loan which requires to be paid back only when the property is sold.
Home reversion plans – This scheme allows you to sell some or all of the property in exchange for a proportional amount of money. By opting for this type, the property does not 100% belong to you, but you can live in it as long as you require by acquiring a lifetime tenancy in the property.
Out of the above mentioned types, you can choose the scheme which best suits your financial requirements.
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Always seek advice from an independent equity release adviser – call 0800 783 9652.
Home & Capital Increase Lending on Home Reversion Plans
Friday, July 2nd, 2010Good news is back in the equity release market as Home Reversion Plan provider Home & Capital increase on two fronts the amounts they will lend on their products.
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Recently there has been a reduction in the number of equity release schemes available in the market which has resulted in fewer options for those in need of cash for their retirement plans.
Therefore news that Home & Capital are reversing this trend with its home reversion plans is excellent news.
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The latest calculations now show that for a male aged 70 the home reversion rate has now increased from 43.25% to 47%. That’s a healthy increase on the amount Home & Capital will lend & represents a good increase on the equity release scheme funds clients will receive.
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Secondly, all Home & Capital reversion plans have had an increased the ceiling on the maximum amount customers can raise.
This has now risen by over 41% from its previous maximum of £85,000 upto £120,000.
The maximum percentage of the property you can sell with Home & Capital home reversion plans is 95%.
Existing offers on the Home & Capital reversion plans will continue. This includes no arrangement fees & a special offer of a free valuation on all applications made before 31st July 2010.
The minimum age for the home reversion plans is 65+.
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These increases come at a time when retired people who wish to consider equity release are being hit on most sides.
Lower interest rates on their savings coupled with the impending increase in VAT will all affect the elderly population greatly over the next 12 months & beyond.
Therefore, there is some light at the end of the tunnel for the elderly who need financial assistance & a supplement to their capital or to boost income.
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With property values showing a steady, yet unspectacular increase since the start of 2010 many people in retirement can be sitting on a large amount of equity that can be utilised.
People are increasingly beginning to embrace the idea that their property is a legitimate asset that can be used to release equity – either via downsizing or via equity release schemes.
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To discuss your equity release requirements further please contact Equity Release Supermarket on 0800 783 9652 or email – mark@equityreleasesupermarket.co.uk
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Are Mortgages Available in Retirement & What Income Is Acceptable To Lenders?
Wednesday, June 30th, 2010It is becoming more common for people reaching state retirement age to still have a mortgage running into retirement.
Even more so, there is a growing demand for extra mortgage lending once they are in retirement.
Here we discuss what retirement mortgage options are available, acceptable income sources & where to look for independent advice on these matters.
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There can be many reasons for having a mortgage beyond state retirement age; namely poor performing low cost endowments, previous unemployment or even long term health issues.
A mortgage that runs into retirement can have major issues with both affordability & term to its repayment date. Most lenders will require repayment on a mortgage by age 75.
We will now look at ensuring all available income is being claimed. Once researched, we can then discuss which of these are eligible for inclusion in mortgage affordability calculations.
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So what options are available on reaching retirement itself?
Well this will depend on affordability & how the financial management of the mortgage itself can continue. The main issue with regards to affordability of an interest only mortgage at retirement is how much retirement provision has been made & maximising any other available sources of income.
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What Type of Retirement Incomes Should I be Receiving?
Having reached state retirement age the state pension will become available. However, the level of this is dependent upon national insurance contributions paid over one’s working life. The current basic state pension is £97.65pw & on its own would not be sufficient to support an interest only mortgage payment alone. State Earnings Related Pension Scheme (SERPS) & any entitlement to the graduated state pension can possibly boost the state pension somewhat, but not substantially.
State pensions are a source of income that can be utilised towards a mortgage in retirement.
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Company pension scheme members can benefit greatly with additional pension income that could be index-linked yearly & be calculated dependent upon the number of year’s service.
There is also evidence that personal pension plans can also boosting retirement income. Increasing importance is being placed in this area on seeking independent financial advice. Due to falling annuity rates it is more important to shop around & optimise your pension fund. Annuity providers can now enhance your pension income if poor health issues exist.
Both company & personal pensions are a source of income that can be utilised towards a mortgage in retirement.
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With the recent economic downturn we have unfortunately seen the reduction in bank & building society interest rates. This has affected investors, once reliant on good interest payments, which would supplement their lifestyle. Again ensure you shop around to obtain a higher interest with your savings is more important than ever. Tax payers should make use of their annual cash ISA allowance of £5100 & non-taxpayers should ensure that Inland Revenue form ‘R85′ is completed in order they can obtain their interest paid gross.
Savings interest can be a source of income that can be utilised towards a mortgage in retirement.
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It is also important to check whether any means tested benefits are available from the Department of Work & Pensions. Dependent upon age there may be eligibility for certain benefits such as pension credit & savings pension credit.
Income levels below £132.60pw for a single person & £202.40pw (2010-2011) jointly could allow a claim for pension credit to be made. Also, check any entitlement to council tax benefit availability, which even though it cannot help mortgage payments directly, it can lower the monthly outgoings.
If there are disability issues then depending on the condition, disability living allowance (DLA), attendance or even carers allowance may be available.
Lenders have different rules on means tested benefits – to see which qualify for a mortgage in retirement contact Equity Release Supermarket on 0800 783 9652
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Maintaining employment through or into retirement does obviously alleviate some of the financial issues. However, experience has shown that there are difficulties in gaining employment.
Nevertheless, it is increasingly apparent that people are now looking to continue working into retirement & provide extra cash to support retirement lifestyle. If part time work can be found then it can not only assist the budget, but also the soul. People in retirement are feeling & looking younger & with more activity in retirement their average life expectancy is rising as social constraints are removed.
Employment income will only help people with existing mortgages going into retirement, but not anyone trying to obtain a mortgage in retirement. Lenders will only accept employment income if a new mortgage is to be repaid before state retirement age.
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Secondary investment properties can provide a form of rental income which can be used towards paying a mortgage in retirement. However, if any existing buy to let mortgage is in operation this will need to be declared & considered as part of the application.
As long as a tenancy agreement is in existence then this will be considered by the lender.
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Although not a specific means of retirement income, equity release schemes can also be considered a means of retirement support. The flexibility of drawdown equity release schemes now incorporates the use of drawdown facilities which are essential in supplementing a flexible lifestyle.
These drawdown equity release schemes provide an initial tax free capital lump sum, with an additional reserve facility that can be gradually withdrawn over future years.
Equity release lenders such as Just Retirement permit additional withdrawals in small amounts of £2,000 a time, which helps retirement planning & provides financial security for the future.
Another method of providing income from equity release is through a Home Income Plan. These equity release plans involve a combination of two products; a Home Reversion scheme & a lifetime annuity. The home reversion company purchases a percentage of the property in return for a tax free cash lump sum. The lump sum can then used to purchase the annuity which can then generate the lifetime pension income required.
Both these equity release schemes will not assist in obtaining a mortgage in retirement. However, in their own right they can provide alternative capital or income in retirement with no monthly payments.
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As you can see there are various income sources which mortgage lenders can consider.
With recent restriction on lending criteria, it is more important than ever to obtain independent financial advice on this specialist area of retirement mortgage finance.
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For further information & advice on mortgages in retirement, please click here for details of interest only mortgages currently available.
Alternatively please contact Mark Gregory on 0800 783 9652 or email mark@equityreleasesupermarket.co.uk
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Can I Have A Mortgage In Retirement?
Sunday, February 7th, 2010Although many pensioners are eligible for a mortgage in retirement, many are not even considering this as an option, or even aware they could apply for one.
Equity release can be a final solution for borrowing in retirement once all other potential avenues of capital raising have been explored, however equity release can be expensive & sold all too quickly without looking at the alternatives.
It is a common misrepresentation that just because people are near to, or in retirement, that they cannot raise funds via a conventional mortgage.
This is grossly incorrect.
As part of any capital raising initiative, all options must be considered & eliminated as necessary upon discussion between client & adviser. By ascertaining disposable income & the clients future intentions with regards to their property, occupation & selected retirement date the adviser can provide recommendations accordingly.
There are two ways that lenders will look at potential mortgage cases: – pre retirement & post retirement income: -
Should one still be working, most lenders will consider employment income only up to a maximum age of 65. The amount that could be borrowed would be based on a multiple of income which varies from lender to lender. It can also be based on affordability, taking into account gross incomes & making deductions for any loans, credit cards or other outstanding debt.
However, how does this affect people considering working beyond normal retirement age of 65?
Not to worry, as there are still a few lenders that would permit this & this is where specialist independent mortgage advice should be sought.
For example Leeds Building Society will take into account current employment income into retirement should they be aged under 60, regardless of the normal state pension age.
Leeds will actually permit the mortgage term to extend into retirement upto a maximum age of 85.
It must be stressed to the client however that payments must be maintained & this could be difficult should employment cease prior to the end of the selected mortgage term.
However, for some this could certainly be an option should their future pension income still be substantial.
For many lenders though, should the mortgage term extend beyond age 65, then only post retirement income will be considered.
This could be income such as a state pension, company & private pensions & some disability benefits etc which are not reliant on employment.
However, due to the lower levels of income at retirement age, this would result in reduced borrowing power into retirement & consequently smaller mortgages.
Dependent upon age, the mortgage term would be determined by the maximum age at expiry of the mortgage. Again, many lenders cautiously use 75 as the maximum expiry age. Should the lender only permit a capital & repayment mortgage, due to the short term this could be expensive.
Therefore, an interest only mortgage could be an alternative if the loan to value is below 75%.
Again, access to specialist advice can result in finding lenders that can potential lend beyond age 75 & also on an interest only mortgage basis.
Should adequate pension provision have been made, then lenders acknowledging this are available & will lend beyond age 75.
Leeds Building Society, Godiva & Halifax’s Retirement Home Plan will fit the bill here.
All three will lend to a minimum age of 85 & in the case of Halifax they will extend to a term of 40 years; more than sufficient for most!
Therefore, before rushing into borrowing in retirement, bear in mind that yes, equity release is an option, howoever is it the best option for everyone?
Probably not & as surprisingly advised to some of my retired clients, (pleasing most as a result) they could be too YOUNG for an equity release!
Therefore, consider the affordability of a mortgage first, as it could be a lot less costly for your beneficiaries than an equity release plan.
For further details on mortgages in retirement & to check eligibility please contact Mark on 0800 783 9652 or email mark@equityreleasesupermarket.co.uk
Just Retirement Become The First Company To Reduce Equity Release Interest Rates In 2010
Monday, January 4th, 2010With immediate effect Just Retirement has reduced their equity release interest rates from 6.79% to 6.59%.
This news arrives in conjunction with the departure of Prudential from the equity release market at the end of 2009 & is a bold move readdressing the negative moves on interest rates at the back end of last year
The interest rate reduction applies across all age ranges & as a consequence Just Retirement now becomes one of the lowest drawdown equity release schemes in the market.
In addition to this rate reduction, Equity Release Supermarket can also obtain a generous £450 cashback for the client on completion of the plan.
This certainly assists in reducing the overall set up costs of the plan.
For further information or quotation on the Just Retirement Roll-Up Lifetime Mortgage, please contact Mark Gregory on 0800 783 9652 or email mark@equityreleasesupermarket.co.uk
