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Posts Tagged ‘Flexible Drawdown Equity Release Schemes’

Equity Release – Three Popular Schemes Offered By Lenders Today

Wednesday, December 15th, 2010

Do you want to unlock money against your property’s value? If your answer is yes, once all your options have been established, then equity release schemes can be perfect for you. These schemes are specially meant for retired people who are over 55 and own property.

To fulfill different financial needs, various equity release schemes have been introduced into the marketplace. From single lump sum schemes back in the early equity release days, through to the more flexible drawdown equity release schemes on offer today.

 

This includes two major types – home reversion plans and lifetime mortgages.

 

The lifetime mortgage equity release is further categorised into various schemes such as:

Lifetime roll-up mortgages – Under this scheme, there is no need to pay the interest every month. The interest accruing will be rolled up annually on to the main debt. This means that you do not have to pay anything and can still continue living in your property. The property will remain 100% in your name with the equity release providers putting a first legal charge at the land registry. This is one of the main reasons why many people opt for this scheme.

Drawdown lifetime mortgages – This scheme is now preferred by many homeowners because it allows them to take payments whenever they want. The best thing about this scheme is that after taking the inital lump sum a reserve facility is created which is a cash fund for future use. This reserve facility allows withdrawals to be made whenever additional tax free cash is required. This could be for an emergency such as boiler breakdown; a purchase such as new car or annual holidays.

Interest only lifetime mortgages – Unlike roll-up lifetime mortgage schemes, this mortgage option allows you to pay monthly interest and avoid building debt. In effect, you are repaying the monthly interest which is accruing, thus maintaining the principle balance at the same level for the duration of the plan term. Schemes such as the Halifax Retirement Home Plan, offer these features whereby you are provided with a term of 40 years & interest only repayments only with NO repayment vehicle being required. Once you have selected this scheme then only the principal amount needs to be repaid to the lender which as with equity release schemes is repaid upon sale of the property.

 

With so many different options available to release equity, why not contact the Equity Release Supermarket by calling freephone 0800 678 5159 today. We look forward to hearing from you.

 

Mark Gregory CeMap CeRER

Director

mark@equityreleasesupermarket.co.uk

 

Equity Release – An Excellent Way To Improve Your Finances

Tuesday, November 30th, 2010

There are many retired people who cannot find the 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.

 

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.

 

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.

 

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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