Equity Release guide discussion

missile · 15 December 2019 at 3:00PM

Each provider will have their own T&Cs.
I suggest you confirm with whichever provider(s) you are considering using.

TELLIT01 · 17 December 2019 at 9:24AM

Thanks missile. We're not in that situation yet, just trying to get a sense of the pitfalls.

missile · 17 December 2019 at 10:08PM

Not all providers charge an arrangement fee.

J98709 · 11 January 2020 at 8:02PM

Has anyone has recent experience with Aviva for transferring equity release to a new property? Solicitors already have all paperwork from the land registry and transfer of deeds would Aviva need to get this again themselves or would they be able to get it from the solicitor?

How long does it take once they get the valuation done to complete the transfer to a new property?

They have advised a very small amount may need to be repaid but this was expected anyway.

Charlie1960 · 27 February 2020 at 9:07PM

Hope that there is someone out there that can give my family some advice. My mum died in 2014 and my stepdad has recently passed away leaving a house. Apparently in 2011 our parents got in touch with an equity release company called Bridgewater Equity Release Ltd who bought the house. What is called "Maximum Release home reversion plan". £35,505 was released. The value of the house at that time was £90,000. They lived in the house rent free. As you can imagine we are all heartbroken as we did not know they had done this. I have also found out that not only did they have a lump sum but every year our parents lived in the house interest will be added. Has anyone come across this and if so what did you do?

Keep_pedalling · 27 February 2020 at 11:26PM

Charlie1960 said:

Hope that there is someone out there that can give my family some advice. My mum died in 2014 and my stepdad has recently passed away leaving a house. Apparently in 2011 our parents got in touch with an equity release company called Bridgewater Equity Release Ltd who bought the house. What is called "Maximum Release home reversion plan". £35,505 was released. The value of the house at that time was £90,000. They lived in the house rent free. As you can imagine we are all heartbroken as we did not know they had done this. I have also found out that not only did they have a lump sum but every year our parents lived in the house interest will be added. Has anyone come across this and if so what did you do?

There should be no interest added with this type of ER, Bridgewater will have purchased part or all of the house for a discounted sum, so this is not a loan. The amount of money they would have received would only be 20-60% of the value of the proportion sold depending on their ages at the time. Have a look at the following link for more info on reversion plans.
https://www.moneyadviceservice.org.uk/en/articles/using-a-home-reversion-plan-to-pay-for-your-care

There were responsible adults at the time they did this and they obviously needed the money which hopefully made their final years a little more comfortable, and the only thing you can do is accept the fact that part or all of the inheritance you thought you were getting is gone.

It is unfortunate that you found out this way, but perhaps they felt embarrassed about telling anyone what they had to do to raise the funds to spend on whatever they did with the money.

lynnechapman · 27 March 2020 at 8:37AM

Hello, I wonder if anyone can give me some advice at this turbulent time.
I am almost 69 and would really like to retire. To aid this we put our house on the market with the plan to downsize and release some money to allow me to do so (because of my work history I only have a tiny pension plus my state pension). Unfortunately however because of the present unpleasantness those plans have fallen through. So my question is - would now be a good time or a bad time to look at Equity Release?
Thanks Lynne

Clowance · 27 March 2020 at 9:31AM

Hi Lynne, there is nothing to stop you researching the pros and cons of equity release and balancing that agains the pros and cons of moving house (which is on hold for the time being). Just dont make hasty decisions, we will probably all be spending less for the next few weeks/months anyway so hopefully you would be able to hold on. Maybe also research if there are any benefits you are entitled to?
best wishes.

lynnechapman · 27 March 2020 at 11:38AM

Nick_Lovell said:

I am an equity release adviser so can give you a professional take on this. Downsizing clearly is the best route but given the issues right now I understand your stance. Equity release is not a short term lending product due to the early repayment charges you would suffer if you then do sell and move. You need to get advice and this is now being done over the phone. Rates are low at the moment but are slowly creeping back up. Speak to an adviser, and get fully informed, but I would not recommend for a short term use, i.e. under 5 years.

Many thanks Nick. It wouldn't be short term, it would be as long as we live (hopefully not short term). I'll get some advice as you suggest. You say rates are low at the moment but are slowly creeping up, I'm not sure if you mean that it costs less to do it or you can release less?

Nick_Lovell · 27 March 2020 at 12:10PM

Lynne, lenders rates are set against the CPI, not the BOE base rates, and also if Gilts are performing well, then lenders will look to increase rates. I have seen a few points upwards, but nothing drastic. This week I was able to secure 2.68% rate for one of my clients. But it is based on youngest borrower and the loan to value. A lifetime mortgage, will only be a first legal charge on the property and is potentially transferable if you move in later years. I would be happy to discuss with you, I am a member of the Equity Release Council and work with the largest UK broker. There are fees to consider but these can be added to the loan, as you will have to have independent legal advice - I work in the whole of market so can look at all 9 lenders and over 300 schemes. There is a huge amount of misconception and negativity around equity release, but it is very much a viable option and whilst not right for everyone is now becoming a mainstream lending mechanism in retirement. The trouble is many are still looking back to the past at older schemes such as shared appreciation mortgages which no longer exist. Hope this helps.

Equity Release guide discussion

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