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How to Get the Best Aviva Equity Release Deal

Monday, March 24th, 2014

Best Aviva equity release interest ratesWhile you might think that going direct to the biggest brand name in the equity release market would be your cheapest option when looking to unlock the equity in your home, you’d be wrong.

 

The leading name in the equity release market is Aviva. Through Aviva Direct they had provided the services of their own dedicated field based sales force to both advise you on clients options and sell you their products. But the direct sales team needed paying for, and those costs were to be met in sales. This sales force needed wages, pensions, company cars, holidays, benefits, a mobile phone. All of this costs and Aviva needs to find that money from somewhere. Their only real option is for all of that to be costed into the direct product.

 

Saving through independent equity release services

In contrast to the Aviva tied-in sales model, an independent equity release brokerage such as Equity Release Supermarket costs the company much less. They don’t have to pay any of those costs or expenses, and those savings can be passed onto you, the consumer. Aviva also want to encourage those independent advisers to send them more business. This is how independent companies can offer more competitive deals and rates. They have no obligations to the lenders.

 

For instance, Equity Release Supermarket can obtain rates on the Aviva Flexible Lifetime Mortgage Plan, starting at 5.68% (5.88% APR). If you get the same deal directly by making the enquiry at Aviva now, even though it won’t be Aviva whom you deal, the rate would be much higher. Beware.

 

This is the reason that Aviva closed down their direct equity release offering as of 1st July 2013. Today over 80% of all equity release deals are coming in through independent firms. Customers have discovered that the best deals could only be found this way. Aviva was the last big company to still provide the direct service, but now they have realised that they can offer the best service to their customers through independent companies.

 

How Do Aviva deal with their enquiries now?

Since Aviva Direct was disbanded, enquiries still filter through from the general public. Not only that, Aviva have still continued with their direct marketing as can be evidenced on their paid listing on Google. But why would they continue marketing when they have no advisers to deal with their Aviva equity release enquiries?

 

Aviva made the unusual decision to use independent equity release brokers to handle the new business & any Aviva additional borrowing enquiries. However, even more unusual is the fact that these independent brokers are unable to deal with these enquiries on an independent basis. They must handle these Aviva potential consumer enquiries by only recommending Aviva’s own lifetime mortgage products. Not only that but this doesn’t come with the independent & best Aviva equity release UK interest rates. Yes, a premium would be paid.

 

So where do you find the best Aviva equity release interest rates?

As with any purchase to be made, the safest option is to always shop around. Therefore, if an Aviva referral to an outsourced company has been made ascertain their independence and whether this constitutes the best equity release deal. Once the quote & recommendation has been made, it then time to research the whole of the equity release market & compare deals. Using comparison tables such as prepared by CompareEquityRelease.com, you can see where the lowest rates relating to drawdown lifetime mortgages, lumps sum plans or even interest only lifetime mortgage scan be found.

 

The message is to understand your needs first. Don’t just plump for the first recommendation, especially if the company providing the advice can only recommend an Aviva plan. Aviva do have a very competitive offering, but this must come from an independent source, not a tied representative arrangement. This tool they use to get the best Aviva interest rate is called the Aviva Flex Tool.

 

What is the Aviva Flex Tool?

Independent equity release brokers have access to a unique quotation tool called the Aviva Flex tool. This is the pre-quotation tool that helps design the customer’s rate & product, whether it be an enhanced lifetime mortgage or maximum lump sum or the Aviva flexible drawdown plan. Based on criteria surrounding the clients ages, property value, health & loan-to-value will determine the lifetime mortgage rate offered. The higher the loan-to-value, the higher the interest rate usually becomes. Additionally, for drawdown lifetime mortgages, the greater the reserve facility required, the higher the interest rate becomes. There, is also the option of choosing certain offers, such as free valuation or a £500 or £1000 cashback.

 

Therefore, by using a combination of tactics with the size of the cash lump sum, the reserve facility and the cashback/valuation offers can manipulate the interest rate in the clients favour. This is something that only a specialist equity release adviser with access to the Aviva Flex Tool can provide & by contacting EquityReleaseSupermarket.co.uk, this access can be made available.

 

 

Work these extras into your Aviva plan

You can build these cash extras to the Aviva plan through Equity Release Supermarket. You might wish to include a free valuation of your property before deciding, or add £500 or £1000 cash back. These are deals that you can only obtain by using one of the top equity release firms in the UK. And the best price on those deals can only be found when using independent advice through companies such as Equity Release Supermarket rather than going through the equity release firm directly.

 

For a free initial Aviva quotation, call the team on 0800 678 5159 or alternatively complete this Aviva quote request form.

Update on the Latest Equity Release Interest Rates

Monday, June 3rd, 2013

Equity release interest rates have never shown as much flux as we are seeing today. There are probably two major reasons for this which is greater competitiveness between the lifetime mortgage lenders and lower long term interest rates.

 

Both factors combined have resulted in equity release interest rates seeing their lowest levels in their history. So, could this be the best time to latch on to one of these deals thereby consolidating a sub 6% interest rate for the rest of your life? Maybe.

 

There are two very good reasons for securing equity release interest rates at today’s levels. Firstly you will be charged less interest (which remember does compound), thus leaving more equity to use later on in life if required. The second reason would be your beneficiaries will benefit as they will potentially have a smaller equity release loan to repay at the end, when the house is eventually sold.

 

So the good news is that everyone is a winner at present. With equity release lending increasing as highlighted by the latest Equity Release Council statistics showing that Q1 of 2013 had a 17% increase in advances than Q1 for 2012.

 

There are many factors fuelling the new tide of interest in equity release schemes. We have seen that there are serious issues highlighted by the FCA report on interest only mortgages and people’s inability or shortfalls in repaying them. Many people are therefore looking at their options & those not wishing to downsize to resolve their shortfall are turning to equity release to settle the bills.

 

This could be in the form of the roll-up equity release where no monthly payments are required. However, if income is not an issue, then a retirement mortgage could be a better solution such as the range of interest only lifetime mortgage schemes we have available now from the likes of Stonehaven, more2life and Hodge Lifetime.

 

This is where expert equity release advice can help save you £1000’s in future potential interest charges. By selecting a company such as Equity Release Supermarket, you are accessing a range of interest rates & deals that are more competitive than standard deals on the market. It is wise therefore to always shop around to negotiate the best equity release deal possible.

 

Selection of the lowest equity release interest rates – June 2013

 

EQUITY RELEASE LENDER PRODUCT

INTEREST RATE

APR

Aviva Lifestyle Flexi Plan

From 5.43%*

5.60%*

Hodge Lifetime Flexible Repayment Plan

5.59%

5.99%

LV= Lump Sum Lifetime Mortgage

5.89%

6.10%

Just Retirement Roll-up Lifetime Mortgage

5.92%

6.20%

New Life Flexible Lifetime Mortgage

5.99%

6.30%

Stonehaven Interest Select Lite (interest only)

5.99%

6.40%

*Aviva equity release interest rates start from 5.42% & dependent on personal criteria.

 

The majority of these deals come with free valuations and cashback offers.

For a full list of equity rates & to compare deals click here.

 

For further information and associated offers with the above lifetime mortgage plans please contact the Equity Release Supermarket team on 0800 678 5159 or email mark@equityreleasesupermarket.co.uk

 

These are lifetime mortgage plans. To understand the features and risks, ask for a personalised illustration.

 

A Whole New Ball Game Begins with Home Equity Release Schemes

Monday, May 21st, 2012

With interest rates being so low, and investments so sluggish, many people who had retired on a nest egg are starting to struggle. The crisis seems far from over so it might be time to consider other options for “topping up” those savings and the income that they create with a home equity release scheme.

 

Most home equity release plans come in many forms but the most common one now is the lifetime mortgage. This style of equity release mortgage is only available to those over the age of 55, as they include special features exclusively designed for elderly and retired people. This more vulnerable age group now has the protection of the FSA (Financial Services Authority) & the trade body currently undergoing reformation which is SHIP (Safe Home Income Plans).

 

Changing attitudes & beliefs

These property equity release plans are designed to be secured on properties which have had most or the entire existing mortgage paid off. Equity release is essentially a re-mortgage, but with special consideration taken into what stage of life the homeowner is in. The statistics show that retirees are now living longer and have a renewed vigour & enthusiasm that has rekindled that sense of adventure from years gone by.

 

Why? The whole idea and acceptance that we are only here once; so ‘let’s make the most of it’ attitude.

 

Home equity release schemes are a great way of topping-up a retirement pension, as they can be arranged to either provide an additional amount of “income”, by slowly releasing the equity from a home in a controlled manner. Otherwise, they can provide a lump sum of cash which can go top-up an emergency fund, or to provide capital that can be used for a lifestyle purposes such as home improvements, a new car or holidays.

 

New lending approach from equity release companies

The benefits of today’s range of home equity release schemes are that they provide excellent value for money, given that equity release interest rates are the most competitive ever. Interest rates are now available from the likes of AVIVA starting from just 5.57% dependent upon age, property value & equity release scheme taken.

 

This new approach to equity release lending takes more account of how potentially profitable a plan is to them. We have already seen this to some degree with LV= who operate a tiered interest rate structure dependent upon age. Basically, the older the youngest applicant is, the higher the interest rate becomes. The principle behind this is, the younger one is, the longer their life expectancy should be. Consequently, the longer the equity release plan runs for the greater the final balance which results in a greater profit margin for the lender.

 

Makes business sense, or does this? Only time will tell, however from the initial feedback and rates being made available from the Aviva trial program indicates that considerable reductions in interest rates can be made, even with the offer of the free valuation and upto £1000 cashback!

 

What effect does this have on the children?

For those looking for the lowest interest rate on a home equity release mortgage a lower interest rate will save £1000’s over the long term. This will reduce the financial burdening of compound interest from day-to-day with the mortgage arranged so that the additional cost of interest charged is taken from the equity in the home. This means that the burden is shifted to the inheritance estate, or to when the home is sold when the policy holders are in care or downgrade their home. In each of these cases, it is likely that the market will be more buoyant and the home will have more value anyway as hopefully property values will have risen over the duration of the home equity loan period.

 

With savings taking such a beating due to low interest rates and pensions being punished so hard by this crisis, many retired people are struggling with their finances. Sometimes products like home equity release schemes can help and provide some extra comfort and peace of mind. They can top-up the incomes provided through annuities or drawdown pensions, and are usually available on terms which are more flexible and costs effective than those taken out in years gone by.

 

Equity release is an important decision. However, with the help & support of specialists in the field of lifetime mortgage and home reversions plans such as Equity Release Supermarket we can find the best equity release deal for you.

 

No matter your location in the UK or Northern Ireland we have equity release schemes covering these locations. So either pick up the phone & call 0800 678 5159 & speak to one of the equity release team or click here to find your local equity release adviser.

 

These are lifetime mortgages and home reversion plans. To understand their features and risks, ask for a personalised illustration.

Is it Worth Reviewing My Existing Equity Release Mortgage?

Friday, May 4th, 2012

There are many reasons why you should sit down & review your existing equity release mortgage. Like any financial undertaking, products do evolve and change, hopefully for the better over the years, & equity release schemes are no different.

 

Here we look at the reasons for reviewing an older equity release mortgage, understanding the benefits & how to go about ascertaining whether you can remortgage your existing equity release scheme, or possibly staying put with your current provider.

 

Reasons for considering an analysis of your existing equity release plan

Let’s first have a look at the factors for consideration in the transfer, switch or remortgage of your current plan: –

  • Could it be because your existing scheme has now exhausted its maximum lending limits with your current equity release provider?
  • Maybe you now require additional tax free cash due to change in circumstances or a financial emergency has arisen.
  • Simply because you require a more competitive equity release deal than at present as you are concerned about the effect the roll-up & the compounding of interest that is affecting your equity release balance.
  • Finally, there could be better equity release plans available in today’s marketplace that were not available many years ago and you wish to take advantage of this to save your children’s inheritance over the longer term.

 

What has changed since you took out your original plan?

Dependent upon when your original plan was taken out, many lenders are now offering better, more flexible and more secure plans. The main influence though will be the fact that interest rates have dropped so significantly. Having experience of advising on the older Norwich Union equity release plans, I have evidenced the fact that around 10 years ago their rates were in excess of 8%! How times have changed.

 

Not only that, but my team of equity release advisers have similar experience of the older schemes which is invaluable in the decision making process & analytics of whether to transfer your existing lifetime mortgage or not. Having worked for the likes of Norwich Union equity release, Prudential, NatWest, Key Retirement Solutions & Aviva, we have the experience & knowledge to conduct a full analysis of the equity release pros and cons relating to a potential remortgage situation

 

How low have equity release interest rates fallen?

The fact is, if you already have an equity release plan, now is as good a time as any to re-evaluate it and shop around. Although not as low as conventional mortgage rates, equity release interest rates have fallen recently, but mainly due to competition in the equity release market. With their aggressive stance presently Aviva have become the darlings of the lifetime mortgage market with their lowest interest rate of just 5.92%. But it doesn’t just stop there. With a free valuation thrown in & £500 cashback this represents the deal of the century!

 

When considering a remortgage, interest rate alone is not the factor that determines your decision. The costs involved in setting up the plan are essential & these should be minimised in order to make the transition ads costs effective as possible. Therefore, the current Aviva Flexi drawdown lifetime mortgage plan is possibly the one plan that would be a viable proposition to switch over to.

 

What other factors must be considered other than interest rate?

It is important to make sure that any new potential equity release scheme is flexible and can be modified whenever your circumstances change. Equity release schemes must meet immediate needs, but equally, it must also be able to adapt to the future. Many new equity release schemes are much more flexible than their previous counterparts. For instance, drawdown lifetime mortgage schemes are now the most popular form of equity release mortgage currently available. This is opposed to the mainly lump sum mortgages that were available in the past, which were inflexible, could only be reviewed every 5 years & you had to budget on this basis accordingly.

 

When reviewing clients existing equity release mortgages, I may find several better and more suitable products on the equity release market today. However, it is not simply a case of switching lenders. Many existing equity release schemes may have clauses that make it quite binding in the long term and may incur additional charges such as an early repayment charge. This factor could be the sole reason whether to switch equity release lenders or not and deter offsetting any savings made from switching to a new plan.

 

It is important to consider several factors while comparing the existing equity release plan to a new one. Current interest rates, the current value of the property and the amount that needs to be borrowed. A switchover can take up to 60 days, so it becomes important to take into account interest rates over 60 days, setting up costs and the current redemption figure to work out the amount that can actually be borrowed.

 

What action should I take now?…

To review your existing equity release mortgage, you will need to consult an independent equity release adviser who can provide impartial, unbiased and experienced advice on different options that are available. A careful and detailed comparison needs to be made, considering various costs that will be incurred during a switchover, including setting up costs, application fees, solicitors’ fees and advice fees.

 

From significantly lower interest rates, to more flexible terms, switching to a new plan may have several advantages for yourself…and your beneficiaries. As a company who is remortgaged many older equity release mortgages we can speak and practice from experience.

 

For a free equity release analysis of your existing lifetime mortgage, contact the Equity Release Supermarket team on 0800 678 5159 or complete the online contact form today.

 

Just Retirement Become The First Company To Reduce Equity Release Interest Rates In 2010

Monday, January 4th, 2010

With 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 678 5159 or email mark@equityreleasesupermarket.co.uk.

 

 
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