Equity Release (or lifetime mortgages) can be used by the over 55's for reasons such as:
- Paying off an existing interest only mortgage which is due to end and you have no way of paying it off.
- Re-mortgaging an existing equity release mortgage could save you money.
- Family members who are finding it difficult to get onto the property ladder and you would like to give them their inheritance early.
- Home improvements such as a new roof or kitchen or alterations to help mobility around the home.
- Moving home or even buying a holiday home - yes! Not many people realise this but if you have a substantial deposit you can use equity release to buy your next home or even buy a holiday home!
- Replacing a car.
- Ease the burden of debt by clearing credit cards and loans.
- Helping out a family member with the financial ups and downs of life.
- Taking a trip to the other side of the world.
- Part of a divorce settlement.
It's basically down to you how you spend monies released from equity release and it is something you need to discuss with your DFP Equity Relase Lifetime Adviser. It is worth pointing out only equity release products suitable for you will be recommended following a full assessment of your personal needs and circumstances by Dorset Financial Planning's qualified and experienced advisor.
Here is an informative video from one lender that summarizes how equity release works:
You Tube explaining how an advisor from Dorset Financial Planning Equity Release can help
USING EQUITY RELEASE FOR BUY-TO-LETS AND SECOND HOMES
An exciting new development is the ability to use equity release to purchase or re-mortgage a buy-to-let property or second home. Please click on the picture below to find out how Mr Britton released equity release from his buy-to-let property.
WHAT TO CONSIDER WHEN DECIDING IF EQUITY RELEASE LIFETIME MORTGAGE IS RIGHT FOR YOU
Taking out a equity release lifetime mortgage can have a very positive effect on your life and many over 55s who are approaching retirement or those already retired, are finding themselves asset rich but cash poor. A home is lively to be most people's biggest investment but are unable to unlock the cash in their homes so they can enjoy a good quality of life, however, there are some aspects that require your consideration when deciding that an equity release lifetime mortgage is right for you which Dorset Financial Planning Equity Release can help you with:
- Alternative ways of releasing cash such as downsizing or using other assets available to you.
- Accessing pension benefits not yet taken.
- Grants for essential home repairs or improvements.
- Equity Release may not be right for everyone. It may effect your entitlement to state benefits and will reduce the value of your estate.
- It may affect your entitlement to means-tested benefits, either now or in the future.
- Would family or friends be prepared to provide financial support?
- Can you rent out a room or part of your home?
- Have you considered your beneficiaries who will receive less inheritance? It would be recommended you get your family or beneficiaries to get involved during the process. Equity Release can help with inheritance tax planning.
- An equity release plan should be viewed as long-term, and you should think about the cost of compound interest over a long period if this is relevant.
- You should discuss how changes in taxation could affect your individual circumstances with your financial adviser, accountant and solicitor, particularly if you choose to apply for additional borrowing. Please note that additional borrowing may not be available on some products. Speak to your equity release adviser if you are not sure if you plan permits additional borrowing.
Tens of thousands of people between the ages of 55 - 95 are already enjoying the benefits of unlocking the cash from their home. Arranging an equity release or lifetime mortgage is complex and it is not suitable for everyone which why it is important to get independent advice before making a decision.