How Does the Aviva Equity Release Calculator Compare to Independent Equity Release Calculations?
An equity release calculator is meant to calculate the maximum release equity that you could potentially release from your property. While only a few companies offered an equity release calculator until a few years ago, today, most independent advice companies, as well as providers, have followed suit and offer equity release calculators on their respective websites. So when using an equity release calculator, is it better to go directly to a provider, or use an independent calculator from the whole of the equity release market?
The best way to get the most out of an application such as an equity release calculator is to have a calculator that provides a free and simple way to calculate maximum potential release, and gives up-to-date and impartial results. However, specific equity release providers such as Aviva are bound to have only their own products on the database of their calculator, and can therefore show a very limited picture of what could be available to you.
The point of an equity release calculator is to get a fair idea of the most you could get and this is in essence a way to shop around and find the highest possibility in terms of equity release. Therefore going to only one single provider for this seems to beat the entire purpose of the exercise! It is important to use an independent equity release calculator that can sift through its database and give you up-to-date and impartial results.
The cons of using Aviva’s equity release calculator
As an example, consider that you live in a flat and use the Aviva equity release calculator. Simply on knowing that you live in a flat, the Aviva will immediately make a deduction of 15% in the valuation before making a calculation, and use only 85% of the entire valuation. An independent equity release calculator will never make such a deduction at the start of the calculation. It will address this issue by using the maximum loan to value figure from the entire equity release market. Not all lenders use this ruling and therefore the importance of independence shines through.
Another example of the negative aspect of using the Aviva equity release calculator would be the locality of the property. Using modern sourcing systems including Environment Agency data flood check risks, Aviva will accept or decline a property on this basis. Only a couple of other equity release providers will use this data in accepting or declining equity release applications. Therefore, the majority of lenders that do not use these criteria maybe could be the best route for an equity release calculation. Again, evidently independence wins the day over tied equity release providers.
An independent equity release calculator has the advantage of having access to all the information that is available, as opposed to concentrating only on one single provider. By using an independent equity release calculator, you could also potentially get a much better deal. For instance an independent equity release adviser will have Aviva rates starting from 5.62%, while Aviva’s direct rate is nearer 6%!
Aviva direct closed its salesforce
In fact Aviva has price differentials for those people who contact them directly. Should you contact Aviva regarding making an equity release enquiry, you cannot get assistance from any of their direct sales force – it has been closed down on 1st July 2013. Aviva now will farm you out to three separate equity release brokers, but not with the benefit of the independents interest rate, but a higher rate than other specialist equity release brokerages such as Equity Release Supermarket get. This effectively means that the long-term cost of seeking advice from Aviva Direct now is higher than going to one of the independent equity release brokerages.
Another significant benefit of using an independent equity release calculator is that you could have access to attractive deals and offers, such as up to £1000 cash-back deals, as well as free valuations which Aviva directly themselves do not offer currently. So not only will there be a lower interest rate, but going to someone like Equity Release Supermarket will save on your initial set up costs.
In summary, Aviva, although are one of the better equity release companies, going directly to Aviva maybe does not offer the best terms. Going to an independent resource could provide you with exactly the same product which is the Aviva Flexi Plan, albeit on preferential terms by using an independent equity release calculator and adviser.