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Posts Tagged ‘Halifax Equity Release’

Will Equity Release Providers Accept Repayments of Interest and/or Capital?

Sunday, January 13th, 2013

A common question that the over 55’s are asking these days is whether equity release schemes are flexible enough to accept repayments of interest and/or capital. With an increasing financially savvy population, particularly those approaching their retirement, this poses an interesting debate.

 

Typically, equity release plans have been associated with the roll-up lifetime mortgage principle, whereby NO monthly payments are necessary. For many retirees this is a daunting prospect given the fact that with the compounding of interest, the inheritance they would leave behind could be severely reduced, if not eliminated.

 

Equity release innovation needed

Equity release providers have therefore been posed themselves the question about how to develop this sector that has historically been devoured of innovation. This lends us back to the original scenario regarding the switched nature of the over 55’s, and how they are now demanding more equity release plans to meet their changing needs.

The baby boomer age group has historically grown up on a life of credit lines such as their residential mortgage, personal loans, hire purchase and credit/store cards. For them, the continuation of a mortgage in retirement is not a serious concern providing adequate pension income is received to fulfil their monthly commitments.

 

Some of these people will have ended up with a mortgage leading into retirement potentially affected by endowment shortfalls or pension fund under performance. Whichever way they have an outstanding mortgage at retirement, there needs to an option available that can address this common problem.

 

Halifax tried and failed

Certain equity release companies have researched this and taken note, particularly given the popularity that the now defunct Halifax Retirement Home Plan. Until August 2011, this Halifax equity release plan offered the over 60’s a mortgage based interest only scheme that would run for the rest of their lives. The void this product has left since being pulled from the market has been enormous and left an opportunity for another interest only provider to fill.

 

Equity release mortgages have now come into their own. Where once they were categorised as a vehicle to enhance lifestyle, they have now become an instrument of necessity, for many who wish to address their retirement shortcomings. These lifetime mortgages can, with product development, provide the ideal solution to an interest only mortgage situation that will only become an even greater issue in years to come.

 

Changes have started

Today the equity release market has opened up and a variety of new plans are now available. 2012 has seen new products come to market that are pushing the boundaries of how the equity release concept can be expanded and accommodate more people into the fold.

 

Therefore, to answer to the question – ‘Do Equity Release Providers Accept Repayments of Interest and/or Capital, the answer is categorically ‘YES’.

 

The next article – ‘Which Equity Release Companies Accept Payments of Interest &/or Capital will discuss the three current equity release providers that will accept repayment of interest and/or capital. Here we can look in greater depth at them: –

 

Hodge Lifetime – Lump Sum Lifetime Mortgage & the Flexible Lifetime Mortgage

Stonehaven – Interest Select Plans – Including Interest Select Lite, Plus, Select & Max

more2life – Interest Choice Plan

 

To discuss these products further call the team on 0800 678 5159 or click here to read the next article on this subject.

The Stonehaven Interest Select Plan Provides Salvation for Those Looking for an Interest Only Lifetime Mortgage

Friday, January 6th, 2012

Products come, & products go; & we have seen the evidence of this by the unfortunate withdrawal from the mortgage market in August 2011 of the Halifax Retirement Home Plan.

 

The global financial crisis has been challenging for many, and retired people or those looking to retire have seen a large amount of value disappear from their pensions. This can be stressful and causes worry, but finance options are still available for those looking to supplement their retirement. Equity Release Supermarket has access to market leading  interest only mortgages which are available only to people over the age of 55 & looking for ways to finance their retirement.

 

An example of such is the interest only lifetime mortgage is the Stonehaven Interest Select Plan. This is a unique and innovative option for many looking for additional financial relief in their retirement, but mindful of any inheritance that they wish to pass onto the heirs. Thus pensioner mortgages are now fully available to anyone over 55 & owning their own home.

 

The innovative Stonehaven Interest Select equity release scheme is unique among interest only mortgages as the total outstanding balance does not change. Instead of the interest rolling up like traditional equity release schemes, the interest on the Stonehaven Interest Select is paid monthly by direct debit. This is often done by the customer, but can be funded via the children or potential inheritors who are looking to keep the amount of debt on the property asset under control.

 

The great thing about the Stonehaven Interest Select equity release scheme is that the total amount of debt is managed for the duration of the interest only lifetime mortgage, making it a great financial product for those looking for interest only mortgages that don’t continue to eat into the ownership of the asset.

 

Due to this controlled nature, the Stonehaven Interest Select mortgages are fixed interest rate lifetime mortgages, the security of which many find appealing.

Stonehaven also provides a no negative equity guarantee, so even if the financial crisis worsens; there is no risk that a burden of debt will be passed on in the inheritance. These are two features which should be discussion points on any kind of interest only lifetime mortgages, as they provide important security and peace of mind.

 

Many people struggling to make ends meet during this financial crisis will be looking for ways to finance their retirement in a controlled fashion. Extra capital can really help to ensure that retirement is financially secure. At the same time, those looking for equity release schemes might be looking for control over how much value is traded for this additional security. Their research journey could start with the roll-up lifetime mortgage option, unaware that they are still eligible for an interest only mortgage even into retirement. Therefore, do not fall into the trap that some equity release brokerages will not advise this type of scheme is available. They may receive higher commission levels than payable by other companies, & this should not sway their advice.

 

Thats why approaching Equity Release Supermarket you will always receive comprehensive equity release advice; impartial & quality recommednations from experienced industry advisers.

They will discuss all your equity release options available, and endeavouring to find the right equity release solution for you. However, if your priority is to control the amount of equity that is being released from your main asset, then the Stonehaven Interest Select plan is THE innovative option to consider.

 

For further details on Stonehaven equity release plans please call Mark on freephone 0800 678 5159 or email mark@equityreleasesupermarket.co.uk.

 

URGENT – Withdrawal of The Halifax Retirement Home Plan on 11th August 2011

Thursday, August 11th, 2011

It is with regret that we are notifying all our Equity Release Supermarket enquirers that the Halifax Retirement Home Plan is being withdrawn with effect from the close of business on Wednesday 17th August 2011.

 

After this date NO further applications will be accepted onto this scheme.

Therefore, to take advantage of this plan all applications must have been submitted by 8pm on the evening of the 17th August 2011.

There is some good news for existing retirement home plan mortgage customers in that they will remain unaffected & their terms & conditions will remain in accordance with their mortgage deed.

Post 17th August, no further applications will acceptable & this will be the last chance to gain access to this unique pensioner mortgage.

With further options for interest only lifetime mortgages remaining limited, act now to secure a last minute place on the Halifax Retirement Home Plan scheme.

 

To make a last minute enquiry call the Equity Release Supermarket team immediately on 0800 678 5159 or email mark@equityreleasesupermarket.co.uk

 

Equity Release v Halifax Retirement Home Plan. The winner is?

Tuesday, August 2nd, 2011

Confusion reigns at a time in life when stability, financial security & freedom to enjoy the fruits of one’s success should be evident. Yes, we are talking retirement, equity release & the increasingly popular Halifax Retirement Home Plan.

We discuss the options available to those already retired or the up & coming baby boomer generation, as they prepare to assess how they are to manage in today’s financial maelstrom.

 

For many, & usually it all boils down to lack of financial planning in earlier life; retirement is none of the aforementioned attributes associated with the longest holiday of your life.

We all go through life thinking retirement seems a distance over the horizon. From getting that first job, raising the children & moving up the ranks in the employment world, our lives move forward apace.

But the inevitable will reach us all one day & without foresight retirement could be the biggest challenge in your lifestyle thus far.

 

So how should we prepare & how do we invest in our futures to ensure a retirement of fulfilment?

 

The spoken word, ‘hope for the best, prepare for the worst must have a ring of truth when it comes to retirement planning. It’s a recipe on the menu that’s always put on the back burner & one on the ‘to-do’ list of things that can wait until tomorrow…YOU CAN’T.

 

Looking back at that first job is where the seeds should initially be sown. Whether it’s joining that company pension scheme or making your own provision, a pension should be the life jacket for your retirement.

The old adage of the earlier you start a pension the less you need to pay in later, is gospel & with the tax advantages on offer they still represent one of the best ways to build a pot of gold for the future.

 

But there are other options now available which represent a safer alternative & more hands on approach such as real estate.

The buy to let market is currently undergoing transformation in the current economic climate, with rental incomes outstripping savers returns on bank & building society accounts. There is also the potential capital appreciation aspect of owning a property which has been a tried & tested route for many over the longer term.

Property is a tangible asset; you have control over how it looks, you can manipulate it & affect its value. The sole aim of these actions is to build asset value & thereby probably without hindsight, can build yourself a ‘retirement vehicle’.

 

So let’s see which vehicle will suit your requirements & enable you to navigate down the retirement highway…

 

Firstly, the question that needs to be asked is whether an income or capital lump sum is required? Given the fact that most tax free cash requirements are for capital, the options are then narrowed down to affordability in retirement.

The next important consideration is whether one can support the monthly payments of an interest only mortgage, or are finances so tight that no further monthly payments are required throughout retirement. The answer to this will filter us towards the ultimate decision; that is whether the solution is an interest only lifetime mortgage or a roll-up equity release scheme?

 

On the one hand you have an interest only mortgage, where monthly payments are required to be maintained for the rest of your life & results in a continuously stable & level balance during the remaining term.

This is in complete contrast to a roll-up equity release plan, which requires no monthly payments whatsoever, but allows the interest to compound & the balance of the mortgage to get larger.

Let’s have a look the features of each option further.

 

Roll-Up equity release scheme

  • Classified as a Lifetime mortgage, hence no term is specified
  • Schemes are regulated by the FSA & are also members of SHIP
  • Equity release schemes start at age 55
  • No income required for eligibility
  • Maximum release is 55% of the property value (with ill-health)
  • Credit history is not a major concern to equity release companies
  • No monthly payments required
  • Increasing balance as the interest is compounded monthly or annually
  • Flexibility of drawdown schemes available to take regular cash releases with guaranteed reserve facilities. This ensures future cash availability with no further costs.
  • Interest rates are fixed for life
  • Reduced,  or no  inheritance left for the beneficiaries of the estate
  • Executors have upto 12 months in which to repay the lender, usually by sale of the property

 

Halifax Retirement Home Plan

  • Classified as a Lifetime mortgage, hence no term is specified
  • Pensioner mortgage & regulated by the FSA
  • Starting age is 65, however with enough pension income, over 55’s are acceptable
  • Retirement income alone will determine how much that can be borrowed
  • The maximum amount borrowed is capped at 75% of the property valuation
  • Credit history is checked & any adverse record could result in a declined application
  • Monthly payments must be maintained to avoid repossession
  • Mortgage balance remains exactly the same throughout the plan term
  • Further advance application required to borrow additional funds & will be credit assessed each time for affordability.
  • Option of tracker & fixed rates available, initially for a maximum of 5 years. Therefore, no guarantee of the future costs of the monthly mortgage payments.
  • Reduced inheritance, albeit a specific amount which the beneficiaries will know the extent
  • Beneficiaries have 18 months in which to sell the property, after death or the mortgagors moving into long term care.

 

So the winner is?

There is no actual winner in this pensioner mortgage market.

Both schemes have the advantages & disadvantages depending upon one’s retirement finances.

 

However, if a good retirement & disposable income is available & future affordability secured, then certainly the Halifax Retirement Home Plan is justifiable for the applicants & more so for the beneficiaries. Nevertheless, it is vitally important that steps are also taken to protect each party to the interest only retirement mortgage in case one applicant dies as the survivor will still need to maintain the monthly payments. Therefore, life insurance should always be considered on the Halifax Retirement Home Plan.

 

Alternatively, for those on lower incomes, less of a disposable income & are not too concerned about their children’s inheritance, then a roll-up equity release mortgage could be their preference. The roll-up equity release schemes have no effect on monthly budget & can never result in repossession based on lack of affordability or missed payments.

These schemes can be classed as a ‘mortgage of last resort’ as once all the alternatives have been considered & eliminated. Equity release roll-up can always be the backup plan. Even more so should one default or struggle with the affordability of an interest only lifetime mortgage such as the Halifax Retirement Home Plan, as equity release schemes can be used to clear the Halifax mortgage.

 

The following is an equity release tip – to ensure that equity release can act as a safety net, if you are looking to borrow on a Halifax equity release scheme then always consider & keep within the loan-to-value limits of the equivalent equity release scheme rules. If you do this then you have equity release as a fall back to switch to in the future.

 

There are many more tips & advice available on this subject, but as always seek an independent financial advisory service such as Equity Release Supermarket who are qualified & experienced in these two specialist fields.

 

For help on deciding which type of equity release is best advice for yourself, please contact the Equity Release Supermarket advisory team on freephone 0800 678 5159 or email mark@equityreleasesupermarket .co.uk

 

Equity Release – Retiring Without Worrying About The Future

Thursday, July 21st, 2011

Halifax equity release is a good option for retired individuals who want to live a tension-free lifestyle after retirement. Unlike traditional mortgage plans, Halifax equity release is specially designed for individuals who are looking for home safety along with a better lending choice. This mortgage option can be used to raise equity from your property if you are over age 55 & are now in receipt of retirement income.

 

The money raised through the Halifax equity release mortgage can be spent the way you want. So, irrespective of whether you want to go on a holiday, exotic cruise or make home improvements, opting for equity release can be great at meeting your financial needs.

 

With inflation constantly on the rise & budgetary constraints we are all facing currently, retired individuals also are facing a lot of problems coping with their finances. However, there are certain requirements one needs to fulfil in order to qualify for Halifax equity release schemes. For instance, applicants must be above 55, retired and possess property of their own. The amount of equity one can release through this scheme depends on the age, pension income & the market valuation of their property.

 

So, if you are planning to go for Halifax equity release, it is always better to ensure that your property is well-maintained. Additionally, if you have a current mortgage on your property this will need to be repaid on competion of your new Halifax retirement mortgage. This will be paid for from the proceeds of the Halifax application & will be redeemed by the solicitor acting on your behalf. Therefore, whenever the interest only mortgage calculations are made the existing mortgage figure should always be taken into account.

 

The good news however, is that if you do have a current mortgage, no matter the size, & remortgaging to the Halifax Retirement Home Plan then there are some excellent deals available. As of July 2011, Halifax remortgages will provide a FREE valuation, FREE standard legal fees & on some products we can even obtain NO application fee.

 

As there are different Halifax equity schemes available today, you must carefully research your options. This way, you can go for one which suits your needs & receive advice from an independent equity release adviser who can provide you with best advice from the whole of the market.

 

If you wish to discuss the current Halifax Retirement Home Plan deals via Equity Release Supermarket contact the team on freephone 0800 678 5159 or email mark@equityreleasesupermarket.co.uk

 

An Introduction To The Halifax Retirement Mortgage

Tuesday, May 17th, 2011

It is of paramount importance that you make sure you have a steady source of income or enough capital after you retire to maintain a comfortable standard of living. You will want to be closer to your family, probably take more holidays with them and spend some quality time enjoying yourself. All this needs money, and the Halifax Retirement Home plan can give you exactly that.

 

Time tested schemes

Though the financial services authority has classified it as a lifetime mortgage, the Halifax retirement mortgage equity release scheme is an interest only loan. It is offered to you by one of the UK’s leading financial organisations.

 

Terms and conditions

Before you decide upon any equity release scheme, you should be aware of its features. Always read the offer document carefully and find out all the clauses, terms and conditions. Since your home is one of the most valuable assets you will own, these schemes can provide you with a significant amount of money.

 

For the latest Halifax equity release rates click here.

Alternatively to establish eligibility, call the team on 0800 678 5159 for a no obligation discussion.

 

Equity Release – Retiring Without Worrying About The Future

Wednesday, July 21st, 2010

Halifax equity release is a good option for retired individuals who want to live a tension-free lifestyle after retirement. Unlike traditional mortgage plans, Halifax equity release is specially designed for individuals who are looking for home safety along with a better lending choice. This mortgage option can be used to raise equity from your property if you are over age 55 & are now in receipt of retirement income.

 

The money raised through the Halifax equity release mortgage can be spent the way you want. So, irrespective of whether you want to go on a holiday, exotic cruise or make home improvements, opting for equity release can be great at meeting your financial needs.

 

With inflation constantly on the rise & budgetary constraints we are all facing currently, retired individuals also are facing a lot of problems coping with their finances. However, there are certain requirements one needs to fulfil in order to qualify for Halifax equity release schemes. For instance, applicants must be above 55, retired and possess property of their own. The amount of equity one can release through this scheme depends on the age,  pension income & the market valuation of their property.

 

So, if you are planning to go for Halifax equity release, it is always better to ensure that your property is well-maintained. Additionally, if you have a current mortgage on your property this will need to be repaid on competion of your new Halifax retirement mortgage. This will be paid for from the proceeds of the Halifax application & will be redeemed by the solicitor acting on your behalf. Therefore, whenever the interest only mortgage calculations are made the existing mortgage figure should always be taken into account.
The good news however, is that if you do have a current mortgage, no matter the size, & remortgaging to the Halifax Retirement Home Plan then there are some excellent deals available. As of July 2011, Halifax remortgages will provide a FREE valuation, FREE standard legal fees & on some products we can even obtain NO application fee.
As there are different Halifax equity schemes available today, you must carefully research your options. This way, you can go for one which suits your needs & receive advice from an independent equity release adviser who can provide you with best advice from the whole of the market.

If you wish to discuss the current Halifax Retirement Home Plan deals via Equity Release Supermarket contact the team on freephone 0800 678 5159 or email mark@equityreleasesupermarket.co.uk

 

Has Halifax’s Retirement Home Plan Seriously Been Overlooked As An Equity Release Alternative?

Friday, December 11th, 2009

At a time when the equity release market is downsizing with the withdrawal of many lenders, alternative funding sources need to be recognised to help widen the options available. It is in the generic mortgage market that some unique & flexible mortgage products can be sourced that offer an alternative to the traditional roll-up lifetime mortgage; it is one of these that I write about.

 

Upon gathering client details & ascertaining a generous disposable income, sometimes it can be evidenced that monthly payments can be afforded into retirement. However, there is a common misconception that someone in retirement cannot have a mortgage.

 

This is incorrect.

 

Providing income multiples can justify the borrowing requirements, then research can be sought that would provide recommendations of suitable mortgage products. However, providers that can lend into retirement have varying criteria with regards to age & the term permitted & here advice & a knowledge of the market comes into the domain of an experienced independent financial adviser.

 

The options available would be dependent on budget, but also on attitudes as to how much inheritance is to be left at the end of the day. Should it be imperative that the maximum inheritance remain, then a capital & repayment mortgage should be advised. Conversely, if this is not a major issue then an interest only mortgage can be recommended which will maintain the balance at the same level throughout the term of the mortgage.

 

Some of the major lenders such as Abbey & Alliance & Leicester do have a maximum age of 75, by which time the mortgage must be repaid. A few will lend to age 85 such as Leeds Building Society which does give more time for the mortgage to run, however, this may only be suitable for capital & repayment mortgages, not interest only mortgages.

 

Therefore, should you be looking for equity release in retirement, have surplus monthly disposable income, wish to ensure an inheritance for your beneficiaries & want the mortgage on an open-ended basis then look no further than the Halifax. It may come as a surprise that such a product may be available with a mainstream lender, however it has become more evident how this product can fulfill in-retirement needs.

 

The Halifax Retirement Home Plan can release cash over a maximum 40 year term, which for someone already near to, or actually in retirement, should be sufficient! They will only permit this product upto 75% of the property value, however this is not usually not an issue due to the amount of equity in retirees properties. Finally, dependent on whether a mortgage currently exists, we can also obtain for you a free valuation & free legal fees.

 

They will also allow the product to use the mainstream Halifax interest rates such as their 2 year base rate tracker at 2.79%, which for a £50,000 interest only mortgage would equate to a payment of only £116 per month. Obviously, consideration must be given to future potential changes that may affect the mortgage, such as the death a mortgagor which would reduce the household income & in turn affordability of the mortgage. However, this can be catered for with a life insurance policy which would repay the mortgage should either party die.

 

Alternatively, it should be borne in mind that if the level of borrowing is kept to within current equity release lending limits, then if one party did die, the surviving party could repay the mortgage with an equity release plan. This would resolve any affordability issues, as no monthly payments would be required thereafter.

 

Having completed several of these products recently, I can vouch for the speed of transacting this deal – 4 weeks, which compared to an equity release application is quicker too. Therefore, rather than just assuming equity release is the only solution, ensure you receive advice from an independent financial adviser – which Equity Release Supermarket can provide.

 

For further information & eligibility for the Halifax Retirement Home Plan please contact Mark Gregory on 0800 678 5159 or alternatively email mark@equityreleasesupermarket.co.uk

 

 

 
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