An increasing number of senior citizens now opt for equity release schemes with the aim to release cash (equity) from their property. This can be a wise decision in order to generate extra income during their retirement years. While a lot of equity release providers are available, not many people are aware of how such equity release schemes work. At such times, it is prudent to consider taking advantage of professional help.
Financial institutions now offer the use of equity release calculators to their customers. Using this tool, one can determine the amount of equity that can be released from their property. Based on the outcome, the applicants can decide whether or not equity release is a viable option for them.
With the number of equity release schemes on the increase, such as the recent addditions of Stonehaven, more2life, New Life Mortgages & last week Partnership, it is more important than ever to seek the services of an FSA qualified independent financial adviser. They will have the equity release tools available they will have been trained with to establish which scheme will provide the correct amount to be released. Guarded with this information it can lend them to the next stages of the decision making process in ascertaining which lifetime mortgage scheme is most suitable for such circumstances.
Therefore, the equity release calculation can be guided towards establishing the following lifetime mortgage scenarios: -
- What is the maximum I can borrow on an equity release plan?
- What is the lowest interest rate on an equity release scheme?
- What is the minimum amount I can borrow on a lifetime mortgage?
- How much can I borrow on an equity release scheme if I am in poor health?
- What are the costs in setting equity release schemes up?
Equity release calculators will help answer these types of questions & with the calculator tools of Assureweb, Trigold & The Exchange each equity release adviser with the CeRER & CeMap qualification, will have these methods of calculations available. However, currently there isn't an operational Halifax Mortgage calculator available.
The workings of an equity release calculator
Various equity release calculator formats exists that can usually be found on the website of the mortgages & other financial organisations. The homeowner first needs to provide information related to their property. Based on this data, the equity release calculator will predict an approximate amount of equity that can be released from their property.
Advanced calculators are also available that offer in-depth information related to different possibilities. However, the availability of such a tool is subject to the equity release provider. Before deciding on a deal, homeowners are always advised to try two different calculators. To get the best deal with equity release schemes, obtaining professional help would be wise.
Practically, the size of the equity release is governed mainly by three factors which are: -
- Age of the youngest applicant
- The valuation of the property
- Whether any existing mortgage or secured loan is present
Dependent upon the answers to these questions will determine the net equity release availability from the property. The data provided by the equity release calculation will be the maximum equity release posssible, however it will give an indication of the extent to which one can go & therefore you will have the knowledge as to whether equity release will be of assistance.
More detailed equity release calculators can advise beyond these basic measures. For instance, should a history of ill heath be present, then a larger than normal lump sum can be achieved with an impaired life equity release scheme. This will not be present or have the ability to be calculated upon by the more basic equity release calculators. Additionally, the majority of calculators will only refer to roll-up lifetime mortgages & not home reversion plans, thus they do not answer the whole question & should only be used for guidance, not literally.
Again, it is therefore of upmost importance to seek the services of a qualified independent equity release advisor who has the accurate research & calculation tools at his disposal; whom with your input & personal information, can guide you to the right equity release plan.
The Equity Release Supermarket calculator can provide an overview & the statistics involved with the maximum amount that can be borrowed on each equity release scheme. Experience our equity release calculator today as see how much you can release. Alternatively, speak to one of the Equity Release Supermarket specialists who can be found in your area by using the ‘find an adviser‘ interactive UK map.
Equity Release Supermarket are established & award winning lifetime mortgage & Halifax Retirement Home Plan specialists.
Call freephone 0800 678 5159 for all your post retirement mortgage questions.