Lifetime mortgage A lifetime mortgage gives you access to some of the tax-free cash tied up in the value of your home while allowing you to retain full ownership. It’s a loan secured against your property, and to be eligible, you need to be aged 55 or over and your property needs to be worth at least £99,000. Interest-payment lifetime mortgage When you release cash through an interest-payment lifetime mortgage, you agree to make monthly interest payments of between £25–100% of the interest added to your loan each month to help reduce your total cost of borrowing. If you’re able to make full interest payments for the life of your plan, it’ll leave you with only the amount borrowed to pay at the end. An interest-payment lifetime mortgage isn’t subject to affordability tests, however, agreed payments must be sustainable as there may be a penalty for stopping payments early. Payment-term lifetime mortgage A payment-term lifetime mortgage could allow you to unlock more of your home’s value than a lifetime mortgage. In return, you must make monthly repayments until you, or the oldest applicant, turn 66. It’s a loan secured against your home, only available to people aged 55–62 at the outset, and your property needs to be worth at least £125,000. A payment-term lifetime mortgage is subject to an affordability check and your home may be repossessed if you don't keep up with mandatory payments. Home reversion With a home reversion, you sell all or part of your property to a reversion company in exchange for a cash lump sum, with no interest to pay on the money released, and no monthly payments to make. When the plan comes to an end, the home reversion provider takes its percentage share of the sale proceeds. You need to be 65 or over. Payment-term lifetime mortgage and home reversion are available through Key Group If another product is more suitable, we may refer you to a different adviser within Key Group who can help. If you go ahead, you'll only be charged the same £599 advice fee you’d pay with us, even if their fee is usually higher. Types of equity release There are four different ways to unlock some of your home's value, tax-free, through equity release. At Key Advice Solutions, our equity release advice only relates to Sunrise lifetime mortgages and interest-reward lifetime mortgages. However, if we believe an alternative equity release product is more suitable, we'll refer you to another specialist within Key Group who'll search the whole market to find the right plan for you.
Are you eligible? You may be eligible for equity release if:
You're aged 55 or over You're a homeowner with a property worth at least £99,000
What is equity release? If you’re a homeowner aged 55 or over, equity release allows you to access some of the cash locked in the value of your home.
Your property’s value, minus any outstanding mortgage or loans secured against it, is the equity. This equity is often passed on as an inheritance; however, an increasing number of people are tapping into some of this wealth to help boost their retirement finances. After years of working hard to make monthly mortgage repayments, your home is likely to be your biggest asset, particularly if you’ve benefitted from an increase in house prices over the last few decades.
An alternative way to release the equity in your home would be to sell it and downsize. However, leaving the family home isn't something everyone wants to do. And with people living longer and pensions typically not being what they once were, for many, savings have to stretch a lot further to last throughout retirement. That's why tens of thousands of people are already enjoying the benefits of unlocking some of the cash from their home through equity release. But we know it’s not suitable for everyone, which is why it’s important to get expert advice before you make a decision.
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