Do you want to unlock money against your property’s value? If your answer is yes, once all your options have been established, then equity release schemes can be perfect for you. These schemes are specially meant for retired people who are over 55 and own property.
To fulfill different financial needs, various equity release schemes have been introduced into the marketplace. From single lump sum schemes back in the early equity release days, through to the more flexible drawdown equity release schemes on offer today.
This includes two major types – home reversion plans and lifetime mortgages.
The lifetime mortgage equity release is further categorised into various schemes such as:
Lifetime roll-up mortgages – Under this scheme, there is no need to pay the interest every month. The interest accruing will be rolled up annually on to the main debt. This means that you do not have to pay anything and can still continue living in your property. The property will remain 100% in your name with the equity release providers putting a first legal charge at the land registry. This is one of the main reasons why many people opt for this scheme.
Drawdown lifetime mortgages – This scheme is now preferred by many homeowners because it allows them to take payments whenever they want. The best thing about this scheme is that after taking the inital lump sum a reserve facility is created which is a cash fund for future use. This reserve facility allows withdrawals to be made whenever additional tax free cash is required. This could be for an emergency such as boiler breakdown; a purchase such as new car or annual holidays.
Interest only lifetime mortgages – Unlike roll-up lifetime mortgage schemes, this mortgage option allows you to pay monthly interest and avoid building debt. In effect, you are repaying the monthly interest which is accruing, thus maintaining the principle balance at the same level for the duration of the plan term. Schemes such as the Halifax Retirement Home Plan, offer these features whereby you are provided with a term of 40 years & interest only repayments only with NO repayment vehicle being required. Once you have selected this scheme then only the principal amount needs to be repaid to the lender which as with equity release schemes is repaid upon sale of the property.
With so many different options available to release equity, why not contact the Equity Release Supermarket by calling freephone 0800 678 5159 today. We look forward to hearing from you.
Mark Gregory CeMap CeRER