Equity Release – A Good Option in Uncertain Times

Equity Release is now a very popular way for the over 55’s to release cash from their homes. The main reason for this is interest rates are at an all time low and these rates can be fixed for the lifetime of the loan. Another reason is the tax free cash sum can be used for absolutely any purpose.

Here is an example of a current equity release product offered by LV (Liverpool Victoria). It is for a couple both aged 68 owning a property worth £400,000 and releasing £100,000.

The £100,000 can be released using a Fixed Rate of Interest for the lifetime of the product of 2.50% per annum with the option of repaying up to £10,000 each year without penalty.

This product offers excellent value and flexibility and there are many more like it. Of course, the amounts and interest rates applicable will be subject to your circumstances.

The Three Most Popular Uses of Equity Release

Gifting to family members – This has two potential benefits: 1) It can potentially reduce future Inheritance Tax and 2) it can help out family members with such things as buying houses, when they need it most. If funds are gifted for property purchases then often the children make a monthly repayment to the parents instead of to a mortgage lender.

Paying off mortgages – This is when people no longer want the pressure of having to pay a monthly amount because under equity release, you don’t have to make repayments as the amount owed can be allowed to role up. However, many clients chose to make optional repayments when it suits as under equity release there is never a threat of repossession.

Investments – Some people invest the amount released to make a greater return. Investments can take the form of property, classic cars, wealth investments etc. Obviously no investment can be guaranteed so it is wise to seek expert advice in the investment field you are considering.

The Equity Release market is booming

Equity release products are now incredibly competitive and there are many major providers in the Equity Release market including Aviva, Legal & General and Nationwide. This variety has created a healthy level of competition. To illustrate this, in 2014 there were 40 equity release products, whereas in 2019 there were 201.

More about myself and the Equity Release Partnership.

I am a regulatory approved, fully qualified, fully independent Equity Release expert with over 20 years experience in the financial services industry. I have access to the whole of the Equity Release market. I know how important it is for people to receive the correct advice, and, because of my fully independent status, I am able to provide this.

Please contact me for an informal discussion

I always offer a friendly service and am happy to answer any of your questions. If you then decide you want to take things further, the process can be completed in person, over the phone or by video chat. My fee of £995 only becomes payable if equity is released from your home.