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Equity Release – How Older People Can Benefit From These Programmes

Thursday, September 30th, 2010

With the economy in its current state, people are trying to come up with new ways to generate capital for everyday expenses. Although it is possible for working individuals to do this, it can be difficult for the retired population. Fortunately, there are still a few ways retired people can gain capital and it is mainly through the equity in their homes that they can benefit.


Equity release programmes can provide retired homeowners with revenue from the value of their homes. These programmes are ideal for homeowners who are not interested in selling their homes and who want to stay there indefinitely. After weighing up the pros’s & con’s of moving & having decided that residing at the family home is to remain permanent, then equity release can be considered.


There are many other benefits offered by equity release

Equity release offers a lump sum that is free of income tax. It can also be utilised in reducing the amount of tax homeowners have to pay for their property. Providing any gift made to children or other beneficiary was made seven years prior to their death then this amount can become exempt from inheritance tax.

Equity release plan holders have the assurance that the interest rate taken at the outset, will remain exactly the same throughout the duration of the plan. Therefore assuming no further advances are taken, the future balance will be known for definate & one can budget for accordingly. If Bank of England interest rates do rise, the equity release interest rate remains unaffected.


All equity release schemes that are members of SHIP will also be protected by a no negative equity guarantee. This ensures that should the equity release scheme become more than the value of the home, then the equity release company can only receive the full market value of the house; any excess over & above will be written off under the no negative equity guarantee.

In addition to this, on the roll-up lifetime mortgage, the plan holders will always retain 100% ownership of the property. Therefore, any escalation in house price will be kept by the equity release plan holder, not the lender.

The capital gained through equity release, which is also known as an annuity, can be used as steady income. However, taking up an equity release programme will result in a lower inheritance for the family after the homeowner’s death. Due to this, it is important to consider this process carefully.


To see how equity release could benefit you, please contact Mark Gregory on 0800 678 5159 or visit Equity Release Supermarket’s website.


Want To Generate Income During Retirement?

Friday, August 6th, 2010

As many people in the UK find it hard to maintain a good living, equity release schemes are becoming extremely popular.

Equity release schemes are specially designed for elderly people between 55 to 95 years of age. With an equity release scheme, homeowners can either get a lump sum amount or regular income.

The beauty of equity release schemes is that homeowners can continue to live in their property for their lifetime. When the homeowner passes away, the beneficiaries will sell the property with the lender being repaid from the sale of the property. Once sold, any remaining equity will be passed to the beneficiaries named in the Will, if one has been made. Should the equity release plan holder die intestate, then the net proceeds will be paid in accordance with the rules of intestacy. This happens if the property is sold for a considerably larger amount than what the balance of the equity release is.


Different options of equity release schemes

The reversion companies offer equity release schemes with different options such as tax free lump sum and home income plans. Home income plans are perfect for senior citizens who want their money in the form of a pension. The amount of equity released is distributed as income or pensions for the rest of their life. This would be in the form of an annuity, which is basically exchanging a lump sum in return for a regular income for the rest of your life.

In such cases, if the equity release applicant has poor health then impaired life terms maybe available. which enhance the standard terms normally paid. This is due to the fact that if the annuity provider considers that life expectancy is potentially reduced due to health reasons, then they can increase the lump sum normally available.

The amount that you will receive via equity release scheme will depend on several factors such as your age, the type of property & its current market value.

If you are looking for the best way to generate income during your retirement, equity release can be an excellent solution to assist the enjoyment of your retirement years.


To establish whether you will be eligible for an equity release with enhanced terms, please contact the Equity Release team on 0800 678 5159 or visit the Equity Release Supermarket website byclicking here.


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