By Richard Jeffcock
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, from debt consolidation to Inheritance Tax Planning.
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 at least two potential benefits: 1) It can potentially reduce future Inheritance Tax and 2) it can put a smile on family members’ faces by helping with such things as getting on the property ladder.
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 roll up. However, many clients chose to make optional repayments when it suits them, giving much more flexibility.
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 and Legal & General. 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 I put your needs first.
FACE TO FACE MEETINGS ARE NOT REQUIRED
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 actually released from your property.
Please call me on 07809 462165 or 01793 272082 or email: firstname.lastname@example.org
Please keep this article for future reference.
HTIA Ltd t/as the Equity Release Partnership. 175 Queensfield, Swindon, SN2 7SU. Authorised by the Financial Conduct Authority (number 776953).