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Equity Release FAQs

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What is a lifetime mortgage?

A lifetime mortgage allows you to release some of the equity from your property into funds that you can use in a variety of ways. The money you release can be taken in one lump sum, or a smaller initial sum with an agreed drawdown amount in the future as needed.
Further advances may also be available subject to the lender’s criteria at the time or a possible remortgage to another lender.
Please bear in mind early repayment charges may be applicable.

Are there any instalments required to repay the loan?

With a lifetime mortgage, there are typically no monthly repayments to make, as the loan, plus roll up interest, is repaid when the plan comes to an end. Usually, that’s when you, or the last remaining applicant, either passes away or moves into long-term care. With a lifetime mortgage, you’ll still retain full ownership of your home.
There are also plans which allow you to make voluntary payments typically up to 10% of the outstanding balance per year. This may be suitable if you want to leave an inheritance for your beneficiaries.

Can I spend my money as I please?

There are many reasons why people choose to release equity, whether outstanding debts, loans to pay, home improvements, holidays, helping family or simply to enjoy retirement more comfortably. You should always think carefully before securing a loan against your home. Our advisers will inform you of any advantages/ disadvantages of your need for equity release.

What amount of equity can I release?

While this will vary from product to product, it depends on your age, health, property value, and if you are applying individually or in joint names. The minimum loan amount is usually £10,000. The loan must be sufficient to pay off any existing mortgage or secured loans on the property, if applicable.

Do I need to involve my family?

Although the final decision is yours, you are encouraged to discuss your plans with your family and beneficiaries, as a Lifetime Mortgage could have an impact on any potential inheritance. We would also encourage you to invite them to join any meetings with your equity release adviser, so they can ask questions and join in the decision.
You may find they are supportive of your decision, or they may have some concerns.
Either way, we believe it is better to discuss your decision with them before you go ahead, if appropriate.

Can I live in my home all my life?

We only recommend plans that meet the Equity Release Council standards which means you’ll be guaranteed the right to stay in your home until the plan comes to an end. This is usually when you, or the last remaining applicant either passes away or enters long-term care.

When will I receive the money?

An easy application with experienced solicitors and advisers takes approximately 6-12 weeks. You will be kept informed about any developments throughout.

What are the average interest rates for a lifetime mortgage?

The rates offered by different lenders can vary, just like conventional mortgages. They will also differ depending on the lender you choose. Although rates are typically slightly higher than conventional mortgages, they will remain fixed for the term of the agreement.

Can I get a lifetime mortgage if I have a mortgage on the property?

Yes, you can. However, equity released must be used first to repay the mortgage(s), or loan(s) secured on the property.

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