Tag Archives: Equity Release Advice

London Calling for Equity Release Pensioners to Cash in on Booming Housing Prices

Year to year, month to month, the housing sector changes which is good news for London property owners. It has been a buyer’s market in recent years as a consequence of the recession and housing prices falling due to the subprime mortgage issue. Now all of that is in the past and there is nowhere to go but up for many of the Capital housing values. If the 11 per cent price increase from 2013 to 2014 is any indication now is the time to take advantage of London equity release products such as lifetime mortgages and home reversion plans. Before getting to how a lifetime mortgage calculator can help determine if this is the right option, take a look at what the product can help you with.

Lifetime Mortgages Aim to Release Tax Free Cash
In a time where housing prices are increasing each month, there is no reason not to take advantage of financial products that can offer tax free cash in a lump sum. Across the UK prices have increased by 3.3 per cent just looking at the month to month figures. Many websites are reporting an 18 per cent increase from 2013 to 2014 in the London area when comparing last April with the most recent April. For individuals over 55 this means your house in London might be worth as much as 18 per cent more in value than it was last April 2013. From last month you might have 3.3 per cent more value in your home.

All this comes down to the total value of your home and the amount you would be able to release in equity. Consider if your home was worth £200,000 last year and it has increased to £225,000. On a sale you would have £25,000 extra equity. With a lifetime mortgage product you have an increased percentage of this equity that you can withdraw.

When you use a lifetime mortgage, you have the option of taking out a loan that does not require any repayment until you move out to a long term care location, a new property, or you die, hence the “lifetime” descriptive word. Equity is based on the value of your property, so if you have no loan then the total value of your property is what is available in equity.

With lifetime mortgages you can take a percentage which can never end up more than 100 per cent of the property value, at the end of the loan. In other words, when you use a lifetime mortgage calculator, & calculate on a roll-up basis, the principle loan amount plus the compounding interest over the life of the loan can never be more than the final value of the property. This guarantee is provided by all London equity release providers by way of a mandatory option, called the ‘no negative equity guarantee’.

The cash you take out is yours to do with what you wish and without tax consequences. It is simply swapping property for cash through a loan, which is why it avoids capital gains tax. Additionally, by working smart, if any means tested benefits are received schemes such as the drawdown lifetime mortgage plan can be used as a work around. By keeping savings levels under the £10,000 limit, no detriment will be afforded to means tested state benefits by taking smaller & regular chucks from the cash reserve facility.

Methods of Using Equity
The prime reasons Londoners over 55 are keen to take out lifetime mortgages, and you might wish to consider it, is how you can use the money. The money can be used anyway you wish, but more importantly it can be used to increase your home value exponentially.

Home improvements such as for a new roof, extending the home; upgrading the appliances, kitchen countertops, and making it more energy efficient are just some ways to increase your housing value. The more renovations you do towards making your home desirable for the next several years, the more it will continue to increase in value. There are certain home improvements that will matter very little to the value, so be aware of what truly increases the property and consider taking advantage of London equity releases.

Another top reason to take out a home equity release mortgage like the lifetime loan is children. Children and grandchildren more often than not, need financial help. Perhaps it is about paying for university for your son or daughter. Maybe your child needs to buy a house, but lacks a down payment. Whether you invest in a second home or help invest in your children’s educational future, it is an investment you can reap benefits from. A simple London equity release mortgage can solve many financial problems, but always seek professional equity release advice.

Advantages of Lifetime Loans
Not only do you get to use the money as you wish, but you can also increase the value in your home if you desire. The money is going to be tax free even if you decide to give a little gift to your children. As long as you keep your “gift” under a certain amount there is no capital gains tax or inheritance tax after seven years for them. You get to help them out and they get a little inheritance to enjoy while you are still alive.

Use a lifetime mortgage calculator to determine what you could release from your London property and start making plans today to enhance your retirement living standards.

Divider

 

Where to Compare Equity Release Pros and Cons Before Completing Any Calculations

Compare the Equity Release Pros and Cons Before Completing Any Calculations

Over a decade ago, releasing equity from your home was virtually unheard of. Today, equity release plans are flourishing, with more and more people choosing to turn to the equity in their homes for relative financial security during retirement.

Equity release is not suitable for everyone, but it does provide a flexible solution for many, and the growing popularity of equity release plans are proof of this. Many new and more flexible products have become available in recent times, and the fact is that the equity release sector has never looked more vibrant.

But the world of equity release schemes still remains confusing for many and it is difficult to negotiate your way around so many different plans; all with their own terms of lending and eligibility criteria. How then does one find the equity release plan that best suits their individual needs and circumstances? And how does one compare different equity release plans to find the best equity release deals?

The answer lies in speaking to a qualified equity release expert who can guide you through the different options and help you understand the equity release pros and cons of each alternative in the context of your individual needs. But firstly, a simple way to sift through the various options is to use an impartial equity release schemes calculator to find out the maximum amount you could raise through different equity release providers.

Equity release pros and cons

These equity release pros and cons are paramount to the decision-making process as they gauge one’s attitude to risk which your equity release adviser will use towards his recommendation. They will not only outline all that is good about equity release schemes, but advise the pitfalls of equity release schemes also. Knowing both sides of the story is essential moving forward as this could be classed as the biggest financial decision of your life, your first ever mortgage aside.

It is important to find a comparison site that offers objective and impartial advice, and has an up-to-date database of providers and plans. This way you can be sure that you are not losing out on something better and are getting the fairest picture of what could be available to you. Check whether they list all the equity release pros & cons for you to easily understand before even seeing or paying for equity release advice.

Independent advice companies like EquityRelease2go.com have pioneered the use of equity release calculators that can quickly work out the maximum release based on some simple facts about your case, including your age and property valuation. These companies continue to provide an impartial and up-to-date service to users who are looking to find the most suitable home equity release scheme.

Not all free equity release calculators are truly free and fair. Some calculators only show a fraction of the picture; while some others use personal information for unrequested marketing from paying partners. While many providers and even comparison sites use equity release schemes calculators as a ploy to extract information from enquirers, there are also companies that seek to provide genuinely unbiased information to customers based on results from all reputable equity release providers.

In summary, it’s vitally important to do your research before committing to anything, seek the equity release services of a reputable independent company who offer a nationwide advisory service such as Equity Release Supermarket whose testimonials & client feedback seem to justify this.