We are are continually being reminded that some people feel uncomfortable because of the stigma attached to equity release. Now the equity release market is bursting with innovation and this keeps building confidence. Inflexible plans are being phased out which removes such issues as greatly reduced inheritances.
Many equity release plans now have repayment schemes included to regulate their outstanding balance and reduce a financial build up. We will help you to dispel any myths by working closely with you by explaining how these new product features present fresh opportunities yet to be unrealised. Let’s distinguish the Myths from the Truth – shall we?
|Interest always rolls up, eroding the children’s inheritance, and leaving nothing left in the estate||Options now exist to repay interest and/or capital regularly to protect both the outstanding balance and future inheritances|
|Equity release products are inflexible and once taken, clients are locked into them forever||Plans can be transferred, accept additional borrowing or even repaid over a fixed term|
|Interest rates and set up costs make it an expensive option over the long term||Competition among lenders has resulted in interest rates now being at their lowest rate with lenders special offers such as free valuations and cashbacks reducing initial costs. Very low cost legal fees can be arranged via Maxlyte Financial|
|Equity release is not flexible enough to meet the requirements of today’s retirees||Whether it’s drawdown, interest only or enhanced, plans are now more versatile and all-encompassing to meet retirees changing needs|
|They don’t provide mortgage solutions to meet the baby-boomers generation||Where lenders are calling in their mortgage books, equity release provides a safe haven to switch to a retirement mortgage plan|
|There are restrictions on age and the maximum amount that can be borrowed||Plans sensibly start at age 55 and lenders will even release up to 50% at an older age|
|The industry lacks strict regulation, with adverse news stories||The FCA now regulates equity release and brokers abide by a strict Equity Release Council code of conduct which protects the consumer|
|Once equity has been released clients are unable to move home||Equity release plans are portable and some are even allowed on retirement developments|
|Repaying the loan is difficult and heavy penalties exist on repayment||All loans are redeemable; however they are designed to run for a lifetime. Now new early repayment options exist with no harsh ERCs|
|There are few recognised brand named lenders, so how can we trust the industry?||Brands such as Aviva & LV= are already present. Legal & General have now entered the equity release market. Confidence is being built by these major players|
We can reassure you that equity release is a safe and effective way of managing finances in later life.