equity release

can anyone suggets a reputable company/bank , or is it something a solicitor can sort

It is something that is done mostly via IFAs and some whole of market mortgage brokers. There are a few direct providers.

I have done it though not for the same reasons as you....

My experience was that working through a mortgage broker/IFA with specialist experience of equity release is essential. We found a suitable local firm. The application takes some time with the mortgage company examining your financial circumstances in some detail and raising questions - it's far from being a simple matter of filling in a form on a website. It is here where the specialist advisor is most useful as he/she can talk directly with the underwriter to explain any complex matters in a way that will help to ensure a successful conclusion. Depending on your personal circumstances, there are risks and potential limitations on your future freedom of action that you need to understand and accept. A solicitor may be needed to ensure your interests are fully protected.

It isnt a simple solution to all one's money problems. The main equity release product these days is a lifetime mortgage. This can be on an Interest Only basis where you pay the monthly interest hopefully at only a slightly higher rate than a normal IO mortgage and the capital is paid off from the house sale when you die. The other option is rollup where the interest is simply added to the debt which again is paid off from the sale of the house on your death.

Rollup will be difficult to obtain if you are younger than 65, and even at 65 you won't get more than about 30% of the property value. If you die at the average age, you would expect the mortgage to use up all the equity in the house. Interest Only at 65 could provide 50% of the house value. However you will need the income or equivalent drawdown pot to pay the interest.

There is a product which offers IO until 80 and then switches to roll-up which seems to provide some of the advantages of rollup whilst releasing the % of the equity available by IO.

ukmartian wrote: »

Thanks for the replies...definately food for thought but it's something I need to do ...unless I win the lottery ...I don't want a mortgage and a dmp hanging over my head till I am 70..I have spoken to my children and they have no problem with it

Equity release is usually a pretty bad deal and a firm rule I have is to never borrow money and pay back just the interest. You can release the equity in your home by selling and moving to a smaller property or renting, have you considered that?

bostonerimus wrote: »

Equity release is usually a pretty bad deal and a firm rule I have is to never borrow money and pay back just the interest. You can release the equity in your home by selling and moving to a smaller property or renting, have you considered that?

It is only a bad deal if you have to pay it back. If some-one has no dependents why would they want to leave behind £100K's of equity tied up in a house? Rather better to leave the house to a mortgage company and use the maximum cash that can be extracted for one's own benefit in one's lifetime. It also gives the mortgage company the job of selling the house rather than lumbering one's executors.

If one has sufficient spare income one option is to trade-up to a house of double the price with much of the extra cost paid by a lifetime mortgage.