New Product innovation for Lifetime Mortgages

The equity release market has seen an increase in the number of new products available this year with an average of one every 28 hours according to the Key.

This means there will have been 525 new products coming to the market between January and August 2020.

This is a massive increase from 2017 when there were just 86 plans available and those plans offering the facility to make interests payments almost doubled from 81 in 2019 to 186 in 2020, giving greater flexibility for customers.

Product innovation and development in this market continues so offering greater choice and flexibility to customers is paramount, enabling them to have the right plan to suit their needs.

For more information and to arrange a consultation with an equity release advisor, contact Blue House Equity Release Kent today

The Equity Release market is taking into consideration the small number of more complexed cases, such as those involving lease extensions or divorce, where more time is needed to allow for the completion of the application through to completion itself.

Through this Equity Release Expansion, providers such as Aviva are therefore extending their re-offer period to 14 weeks currently the longest on the market, so they can both accommodate advisers and their customers.

This means that the valuation report expiry date will also be realigned so that it matches the original offer and re-offer period, effectively valid for 28 weeks.

These sorts of improvements come about where providers are taking into account adviser and customer feedback, showing the flexibility of the equity release market to service their customers well.

For more information and to arrange a consultation with an equity release advisor, contact Blue House Equity Release Kent today

Credit Card Debt – Over 55’s

I was speaking with someone the other week about Lifetime Mortgages and he mentioned those in retirement who are unfortunate enough to be taking their credit card debt with them in retirement and that the cost of this is debt is quite a considerable drain on their reduced income.

He made what I thought was a valid view and that not only are these debts often in the tens of thousands but also just how high the interest rates are on credit cards at anything up to 30%pa and in some cases even higher.

He did not understand why those who are retired, living in their own home wasn’t using equity release in their droves to repay these credit card debts off, especially when you consider the low-interest rates available on a Lifetime Mortgage product these days.

• February 2020, the UK’s credit card debt £67.9 billion *
• In July 2019, there were 61.9 million credit cards issued to UK residents *
• Average interest rate February 2019 18.7% *

With credit cards charging anything up to 30% and beyond and equity release products averaging around 4% and in some cases even lower rates being available, why wouldn’t a homeowner over 55 consider finding out about different solutions and the possibility of equity release as a possible solution for them, allowing them to change things so they can either make no payments and let the interest roll-up or to service it by making payments?

Either way, buy opting for a Lifetime Mortgage as a solution, those in retirement can either eliminate the monthly payment or reduce it greatly.

*Chris Lilly, publisher at Finders.com, Jul 17, 2020

For more information about your equity release options, please contact Chris at Blue House Equity Release today

**Remember that if you are in receipt of means-tested benefits, releasing equity may affect your entitlement. Fortunately, there is a range of plans available to help you manage the impact of a lifetime mortgage. You should seek professional advice on the best option to suit your needs and ask an adviser for a personalised illustration to ensure you understand all the features and risks.

As the popularity of Equity Release has soared, there are many misconceptions about equity release which hold people back from considering it and changing their lives.

So, let’s debunk some myths about Equity Release/Lifetime Mortgages.

Myth 1. There will be nothing left for my loved ones.

Lifetime mortgages have become increasingly flexible in recent years, and there are now plenty of plans available which allow you to protect a portion of your equity for inheritance.

If you don’t want your loved ones to have to wait until you die before receiving financial support from you, you could use equity release to provide them with an early inheritance.

Bear in mind, however, that using a portion of your equity now means there will be less available to you later and may reduce the value of your estate.

Myth 2. I still have a mortgage on my property, so I will not be able to release equity.

Having a mortgage does not mean that you cannot release equity. In fact, using property wealth to clear an existing mortgage is one of the most popular uses of an equity release/lifetime mortgage.

Myth 3. I will not own my property anymore.

Equity release does not mean selling your home to a lender: you are simply borrowing against it, and you still remain ownership.

Unlike a conventional mortgage, a lifetime mortgage has no fixed end date, so the mortgage lasts for as long as you need it.

Myth 4. I will be paying monthly payments for my lifetime mortgage.

There are no monthly payments to make with a lifetime mortgage – unless of course, you choose to make them.

Some plans, however, allow you to make optional, penalty-free repayments of up to 10% per year of the mortgage balance and there is even a plan that will allow you to make payments of up to 40% now.

If you choose not to do this, then the interest on the amount you have borrowed will roll up over time.

This loan and any interest must be paid back when the property is sold, either when you pass away or move into permanent long-term care.

If you have taken out an equity release product as a couple, it will continue for as long as one of you remains in your home.

Myth 5. I will end up owing more than my home is worth.

Provided you take out an equity release plan with a provider approved by the Equity Release Council, your plan will come with a no-negative-equity guarantee, which ensures you will never owe more than the value of your home when it is sold.

In the unlikely event that your home sells for less than the amount of the mortgage, the remaining balance will be written off, this is called the No Negative equity guarantee.

Typically, once the mortgage has been repaid, any remaining funds will be paid to you or the beneficiaries named in your will.

For more information about your equity release options, please contact Chris at Blue House Equity Release today

**Remember that if you are in receipt of means-tested benefits, releasing equity may affect your entitlement. Fortunately, there are a range of plans available to help you manage the impact of a lifetime mortgage. You should seek professional advice on the best option to suit your needs and ask an adviser for a personalised illustration to ensure you understand all the features and risks.

The Equity Release market has continued to give the over 55’s options

We have seen an increase in the number of equity release applicants looking to provide money to relatives as a result of the COVID 19 following its impact on family finances.

The majority of older homeowners decide to opt for equity release in order to meet their financial needs, with many borrowing to boost income or provide for things such as holidays, purchasing a holiday home, home improvement, clearing a mortgage or other debt or funding other purchases, like a new or vintage car for instance.

We also find equity release borrowers are frequently setting aside money from the release to help their children and grandchildren for things like, getting onto the property ladder, helping with funds for their business, paying for weddings or helping with university fees amongst many things.

I’m expecting enquiries to continue to grow/boom as moreover 55’s decide that they not only want to change their own lives but also help their family by unlocking money from their home using a Lifetime Mortgage.

Providing cash to their children to help fund business following the difficulties during the COVID19 period and also helping with deposits so their children can get onto the property ladder or even to be able to make that next property purchase, having a growing family requiring a larger property.

For more information about your equity release options, please contact Chris at Blue House Equity Release today

The Mortgage and Equity Release markets have been affected like most during these difficult times with COVID19 and there has been a reduction in applications.

However, there is still tremendous interest out there, with so many who have been waiting things out and finding that now is the time to take action and get things moving.

Now that Lockdown is being eased and with great caution, of course, the markets are starting to see life and interest is beginning to flourish, so now is the time for homeowners over 55 to change their lives by visiting equity release and the lifetime mortgage for the things they want, by unlocking money from their home.

Not everyone over 55 has woken up today thinking they must do equity release and thought about where to go to find out about a lifetime mortgage. As a potential solution to help or in some cases that they should take a look at the lifetime mortgage they did a number of years ago where interest rates were a lot higher than those today and where a rebroke could potentially save them money over their lifetime, therefore taking advantage of the lower interest rates of today.

A Lifetime Mortgage can help change lives, whether it’s a financial problem or an aspirational dream or both, It does not cost you to speak with me confidentially at Discover Equity Release to find out if an Independent, Whole of Market, Lifetime Mortgage will work for you.

For more information, contact Blue House Equity Release today