As such, they will most likely be Enness’ first port of call if you wish to release equity from a property you own. Historically, retail banks tend to have a more rigid approach to equity release transactions, while private banks and niche lenders are more flexible. For straightforward transactions, many high street banks are ideal. However, for more complicated situations and borrowers, the use of private banks is often more advantageous. After the UK changed its stamp duty regulations, many individuals saw a significant increase in property purchase costs. In addition to the relatively low-interest rates, it can make more sense to redevelop an existing property or family house rather than try and buy a new home.

Given the significant competition for property and the time it can take to secure a mortgage, releasing equity to invest in redeveloping a property or home can make good sense. By taking out a plan on your house, the equity released will be taken from the value of your assets accordingly. On the result of your death this is likely to reduce any inheritance tax that would otherwise be payable. Currently, how does equity release work is only applied if the value of the estate exceeds £325,000. A lifetime mortgage means you retain ownership of your home until it’s sold, once you and your partner have passed away, or moved into long-term care. This is not the case for Home Reversion Plans, where you give up total or partial ownership in return for a lifetime lease.

Interest only mortgages – The capital amount to be paid back remains the same with only the monthly interest being repaid. These schemes are usually available to people at a minimum age of 55, and sometimes 60, years old. The amount you can borrow depends on many factors – your age, the value of the property and, on occasion, your health. And, according to the Equity Release Council , in the first 3 months to the end of June, a record £971m was borrowed by homeowners 55 and above. Money can be in short supply in later life, but you have financial options that can enable you to get back in control.

This could enable them to afford to go to university, pay for a wedding or even help them get a start on the property ladder by gifting them a deposit for their first home. Psychological services – clients get free sessions of mental health support, from counselling to Cognitive Behavioural Therapy. Prescription services – clients can get a private prescription, without needing to visit their GP. Please remember that the loan plus interest can add up very quickly. Being aware of the options available is crucial – here are some important things you should know about our Lifetime Mortgage Lump Sum+.

The UK Prudential Regulation Authority expressed concerns in 2018 that firms investing in ERMs should ‘properly reflect’ the cost of the no-negative-equity guarantee. Its consultation paper CP 13/18, published 2 July 2018, provided a benchmark for valuing the guarantee. As long as your figures add up and you have further collateral to give lenders comfort, equity release is often a very straightforward decision for lenders. If you own worldwide assets and you have various income streams, you will usually find that private banks are better able to cater to you and understand what you bring to the table.

There are flexible withdrawal and repayment options for lifetime mortgages, which give you the option to receive either a one-off cash lump sum or a smaller lump sum with a cash reserve to draw from. Plus you can choose to make partial repayments or you can choose to make no repayments at all during your lifetime. This course provides a grounding in the market for equity release products, the products themselves, and the processes involved in advising and selling lifetime mortgages and home reversion plans. Some of the text runs as a sequence, starting with identifying needs and moving through the pre-contract, contract and post-contract stages.