We are known in Britain as being a nation of homeowners and in recent years for many people their homes have become a valuable asset. However we think of where we live not just as a financially valuable asset but as a home. It is more than just the value of bricks and mortar-it represents both security and a haven. We feel differently about our home than about other assets we might own and certainly don’t regard it in the same way as shares or ISA’s
Despite the recent slow-down in the housing market it has, never the less been hard not to notice the enormous rise in the value of this asset in recent years.
So not only does the home fulfill a psychological and emotional need, but it also represents a sound investment, It may indeed be the best investment you have ever made-many older people have not seen other financial aspects of their life perform nearly so well. Pensions, whether state or private have not necessarily provided the worry-free income that many expected.
As a consequence, people often find themselves in the frustrating position of having a more limited income in retirement that they anticipated and yet living in a property which has grown enormously in value and is their most valuable asset.
Equity Release is a way of getting cash out of your property value without the need to move. You either secure borrowing against your home or sell all or part of it. This can give you a regular income, a lump sum, or both. Any amount raised does not result in monthly payments. Instead, the loan is repaid on death, or other circumstances such as having to move to a Care Home.
The amount you can raise is dependent on your age and the value of your property. Consider a couple, both 65 years old, with a home worth £180,000. This couple may be able to raise a lump sum of approximately 25-35% of the value of the property and at age 75, this can increase to 45% of the value (source Assureweb research system, June 2016).
This lump sum can be used for any purpose, such as Home Improvements, Buying a New Car, Paying off Loans, Going on your Dream Holiday, or even treating the grandchildren!
These schemes can be helpful in certain circumstances but are not suitable for everyone. For example, they can be expensive and inflexible if your circumstances change in the future, interest rates, fees and early repayment charges vary between lenders and taking an Equity Release scheme may affect your current or future entitlement to State or local authority benefits.
Getting the right advice is vital
Spectrum Independent Financial Services offers you expert and completely impartial advice on the suitability of Equity Release Plans for your circumstances. Our advisers have the necessary qualifications and experience in dealing with all types of clients with differing needs. We use the most up to date computer research tools, ensuring our clients get the most competitive products for their needs. We will deal with your Equity Release need in a sensitive manner, and we will provide guidance through the whole process including appointing surveyors, helping you appoint an Independent Solicitor, and ensure that you receive your funds in a timely manner.
We also recommend that you involve your family in the decisions you make and they are more than welcome to attend any of the meetings we have with you.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOU SHOULD NOTE THAT YOU HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
These are Equity Release plans. To understand the features and risks you should ask for a personalised illustration. There may be a fee for advice, the precise amount will depend on your circumstances but we estimate it will be £695