Some people have concerns about taking out an Equity Release plan. However, customer protections put in place by the Equity Release Council – a voluntary body – should dispel some of those worries (some examples are below). The below protections apply when you deal with a member of the Equity Release Council. Please be aware that Equity Release is not suitable for everyone and advice should be sought before making a decision. Not all advisers, firms or mortgage lenders are part of the Equity Release Council so this should be confirmed upfront.
Q: Can the provider take away my home?
A: All products from Equity Release Council lender members have a guaranteed security of tenure, so customers will be allowed to remain in their property for life, or until they move into long-term care, provided that the property continues to be their main residence. In the case of a joint policy, then this applies to the last surviving borrower.
Q: Can either my beneficiaries (or me) end up owing more than the value of my home?
A: Plans from Equity Release Council lender members have a no negative equity guarantee. This means that regardless of the value of the home or how long the customer lives, they will never owe more than the value of their home, and no debt will ever be left to the estate.
Q: Can I still move home?
A: Customers, who’ve taken out an Equity Release plan, have the right to move, subject to the new property being acceptable to the product provider. Part of a lifetime mortgage loan may need to be repaid, if moving to a cheaper property.
Q: Can I be confident that all aspects of the plan will be explained to me?
A: Customers will be provided with a fair, simple and complete presentation of their proposed plan, ensuring that they can identify its benefits and limitations.
Please talk to us to see if we can help you with equity release. Get in touch with us on 01609 760960. Or arrange a call back and one of our mortgage brokers will be happy to help.
Reference – BL103 – July – 2020
The content of this article is for general information only and should not be considered advice. Professional advice relating to your individual circumstances should always be sought prior to making any decisions or taking any action. Equity Release is not suitable for everyone. You should seek advice to ensure that you fully understand all implications for you and your home and for anyone who might otherwise inherit the property. All details were correct at the time of writing.