Free Switch Plans Calculator
Switching equity release schemes can save yourself and beneficiaries £1,000’s worth of equity in your property by swapping to a lower interest rate. Our switch plans equity release calculator can help review your existing scheme, check you have the best deal available and advise how much you can potentially save by swapping equity release plans.Like house or car insurance, even residential mortgage, shopping around each year can potentially save you money by swapping your service provider. This scenario also applies to switching equity release plans. Here we explain how to save home equity…
How Our Switch Plans Calculator WorksFirstly, we analyse your existing equity release scheme. We take the most upto date balance from your current lifetime mortgage provider, plus details of any early repayment charge and interest rate. The switch equity release calculator can then project forward your future balance.
Against this, the switch plans calculator will then compare a new equity release scheme rate* including average set up costs**. Projecting this balance forward, the switch calculator will compare yearly balances of your new to old plan & calculate the savings/losses. These results are then illustrated for you.
3 Reasons to Swap Equity Release Schemes
- When applying for a ‘top up’ – taking a further advance is the perfect opportunity to analyse your old scheme. Your adviser should always check the viability of staying with your existing lender, or best switching to a new product
- Finding a lower interest rate – equity release interest rates have been as high as 8%. With compounding effect, this could quickly erode the value of the estate. Switching to a lower interest rate would preserve equity long term
- Flexibility and repayment options – latest equity release plans have improved features. These range from drawdown plans, voluntary repayments, inheritance protection and fixed early repayment charges. Swapping equity release schemes can help you inherit all this flexibility
How to Switch Equity Release SchemesThe team at Equity Release Supermarket have been advising on equity release schemes since the late 90’s. We have analysed plans from Prudential, Norwich Union (Aviva), Saffron, Northern Rock (Papilio), In Retirement Services, Godiva (Coventry) and Natwest, some of whom have now ceased lending. Even lifetime mortgage providers around today, previously offered less competitive interest rates, terms & conditions and options.
Switching equity release providers can therefore provide access to the latest range of more competitive and flexible equity release plans. Our equity release remortgage advisers will follow up the results provided from this calculator. The team can then explain the remortgage process involved & find the best product based on your needs from the whole of the equity release market.
Whether switching equity release plans is in your best interests, several important factors that need to be considered: –
- Early repayment charges (ERC’s) – of the existing plan can determine whether remortgaging is viable, or not. If they are too punitive, then switching should be postponed. Additionally, switching from a fixed penalty to a gilt based early repayment charge should also exercise caution. During any application to switch providers, your adviser should monitor any change in ERC should you be transferring from a gilt based plan.
- Set up costs of new plan – when swapping equity release schemes ALL costs involved must be factored into the equation to ensure comparability. For calculation purposes, the switch plans calculator assumes representational set up costs totalling £2,000**.
- Daily interest during application – every day a plan is in force, interest is be added to the balance. Therefore during any application to remortgage, extra interest of approximately 60 days should be factored into your calculations to ensure no shortfall exists at completion. For calculation purposes Equity Release Supermarket uses a comparable interest rate of 5.0%*AER.