Devonshire House, 582 Honeypot Lane, Stanmore, Middlesex, HA7 1JS
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Devonshire House, 582 Honeypot Lane, Stanmore, Middlesex, HA7 1JS
Moving home can be a stressful and expensive process at any age. Many people would prefer to stay put and benefit from the ‘equity’ or value tied up in their homes, and equity release schemes allow them to do that.
These are the main options available to older homeowners:
A RIO mortgage is similar to a standard interest-only mortgage, but in this case the loan is usually only repaid when you sell the property, die or move into long-term care. RIO mortgages usually have a minimum age requirement of 50, though some lenders may require borrowers to be 55 or 60.
With a Lifetime Mortgage, a loan is taken out on the property to provide a lump sum, an income or a combination of the two. No interest is payable until the home is sold, which could be when you and your partner have both gone into long-term care or died.
A Lifetime Mortgage with a drawdown facility allows you to take the cash in stages, as and when suits you. This gives flexibility and the reassurance that you can access further funds at some point in the future, should you need them. It is more cost-effective, as interest is only charged on funds when they are drawn down.
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage(s).
Equity Release will reduce the value of your estate and can affect your eligibility for means tested benefits.
Estate Planning is not regulated by the Financial Conduct Authority.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR MORTGAGE IS SECURED ON YOUR HOME, WHICH YOU COULD LOSE IF YOU DO NOT KEEP UP YOUR MORTGAGE PAYMENTS.
EQUITY RELEASE MAY INVOLVE A HOME REVERSION PLAN OR LIFETIME MORTGAGE WHICH IS SECURED AGAINST YOUR PROPERTY. TO UNDERSTAND THE FEATURES AND RISKS, ASK FOR A PERSONALISED ILLUSTRATION.
EQUITY RELEASE REQUIRES PAYING OFF ANY OUTSTANDING MORTGAGE. EQUITY RELEASED, PLUS ACCRUED INTEREST, TO BE REPAID UPON DEATH OR MOVING INTO LONG-TERM CARE. EQUITY RELEASE WILL AFFECT THE AMOUNT OF INHERITANCE YOU CAN LEAVE AND MAY AFFECT YOUR ENTITLEMENT TO MEANS-TESTED BENEFITS NOW OR IN THE FUTURE.
CHECK THAT THIS MORTGAGE WILL MEET YOUR NEEDS IF YOU WANT TO MOVE OR SELL YOUR HOME OR YOU WANT YOUR FAMILY TO INHERIT IT.
IF YOU ARE IN ANY DOUBT, SEEK PROFESSIONAL FINANCIAL ADVICE.