Life Can Be Exciting At 55 With Equity Release

Life does begin at 55 with equity release. Why wait until you retire to fulfil those ambitions and goals? Does your list could include foreign travel, an extension or improvements to your home? Or perhaps a luxury item such as a car, yacht or plane? Perhaps you want to buy a holiday home, help your children or grandchildren or reduce your inheritance tax? The only sticking point is that you don’t think you have the financial means to pursue your ambitions. However, stop, if you own your home and are 55 or over, an equity release mortgage could provide the additional source of funds that you are looking for. A lifetime mortgage could allow you to release money from your home to finance your ‘to do’ list.

What are you dreaming of?

  • Worldwide travel
  • Making home and garden improvements
  • Purchasing a luxury item – car, yacht or a plane
  • Buying a holiday home
  • Helping your children
  • Reducing your inheritance tax

The world is your oyster

You may well have a bucket list of places you want to visit. These might include the Inca settlement of Machu Picchu in Peru, the Taj Mahal in India, the tombs and temples of Petra in Jordan or the Kruger National Park in South Africa. Perhaps the places on your list are nearer to home and include travelling on the Orient Express, visiting the Amalfi Coast in Italy, Provence in France or Santorini in Greece. All you need is the money to pursue your travel dreams.

Home and garden improvements

These range from updating the kitchen and/or bathroom to building an extension. The latter might be for a bedroom downstairs so that you can be more comfortable as you get older. You may also find that you are spending more time in the garden and a makeover, garden chalet or even a pool would certainly make your time there more enjoyable.

Buying a holiday home

Releasing the wealth from your home could enable you to make a cash purchase of a holiday home or help to fund a mortgage deposit. In order to comply with the terms and conditions of a lifetime mortgage, there will be certain stipulations. The property will need to be maintained, you will have to be a UK taxpayer and you will be required to reside in your UK home for at least 183 days of the year.

How can Paxton Equity Release help you achieve your dreams?

So what’s on your bucket list? Why not go for it? It’s true that you do only live once! An equity release mortgage could give you the financial freedom you are looking for to pursue those things you have always wanted to do. In order to be eligible for a lifetime mortgage, you must be aged 55 and over, be a UK resident and be a homeowner with a property worth at least £70,000. If you do think a lifetime mortgage would be right for you, please get in touch with Martin on 01892 617070 for a chat or email martin@paxtonuk.com.

A Lifetime Mortgage Or A Home Reversion Plan?

A lifetime mortgage or home reversion plan?

Do you take out a lifetime mortgage or home reversion plan? Taking out an equity release mortgage for anyone is a big step and so it’s important that you understand the different types and choose the one that would be right for you and your family. In a nutshell, the two most popular choices are a lifetime mortgage and home reversion plan. Here Paxton Equity Release, based in Tunbridge Wells, Kent looks at what they entail and the considerations that you have to make to understand which is the most suitable scheme for you.

What is a lifetime mortgage?

The most popular type of equity release plan is a Lifetime Mortgage, which gives you a tax-free cash lump sum to be spent on the things that you want to have and enjoy. It is a loan that is secured against your home and normally there are no monthly repayments. This type of mortgage plan allows you to maintain 100% ownership of your home and normally up to 50% of the value of your home can be released depending on your age.

Different types of lifetime mortgages

So how does this work? During your lifetime, compound interest is added to the loan and this with the lump sum that you receive is paid back when your home is sold, you move into long-term care or you and your partner die. There are different types of lifetime mortgages including drawdown, enhanced, protected, combined and interest payment plans.

What is a home reversion mortgage?

In this type of plan, you will be selling a share of your property and will become the co-owner. You will be able to continue to live in the property for the rest of your life. In essence, a percentage of your property is surrendered in exchange for a sum based on the current value of your property. Some or all of your home is sold to a provider. The sum you receive is determined by a number of factors including your age, value of your home and health. With this type of mortgage, typically, the older you are, the more money you will be able to release.

Home reversion plans may be more suited to older people

With a home reversion plan, you will receive less than the market value of your home. This is because the buyer will be unable to sell it until you move into long-term care or you die. When the property is sold, the lender will receive the negotiated percentage of the net selling price. Interest is therefore replaced by property inflation. This means that the minimum age for eligibility for these plans is normally higher than for a lifetime mortgage. Although this type of mortgage is not as popular as a lifetime mortgage plan, it could have benefits for some people.

Considerations you must make before making your decision

  • How much equity do you want to release from my property?
  • What is your property worth?
  • Your age?
  • Your state of health?
  • How much do you want to leave your family as an inheritance?
  • What do you want the money for?
  • Do you want to give up full ownership of your home?

Fundamental differences between the equity release products

The fundamental differences between the two equity release products are as follows:

  • With a lifetime mortgage, you still own your home. The lender’s involvement is the interest that they charge, which will roll up. You do have the option to pay some or all of it back on a monthly basis.
  • With a home reversion plan, you sell a share or all of your home in exchange for a lump sum of money. The lender owns it all or in part. Their ‘investment return’ will be the amount the market value has increased.

Speak to an experienced adviser and discuss it with your family

Make sure that you speak to an equity release adviser who is prepared to go through the different alternatives with you. You want to ensure that they will only recommend the best and most suitable option for you based on your circumstances. Be very wary of any hard selling and an adviser who wants you to sign on the dotted line quickly. You will need time to think about what plan is the most relevant for you. It is something that you may wish to discuss with your family.

How can Paxton Equity Release help you with your choice?

Martin from Paxton Equity Release will be delighted to go through whether a lifetime mortgage or home reversion plan is suitable for you. He will sit down and go through your options so that you can see whether an equity release product will meet your needs and circumstances and be the right choice for you and your family. Please call Martin on 01892 617070 for a chat or email martin@paxtonuk.com

A lifetime mortgage or home reversion plan?

Myths Surrounding Equity Release Explained

There are many myths surrounding equity release. It is probably fair to say that some years ago, these types of mortgages did have some bad press. However, it really could be to your benefit to disregard the myths, most of which are completely unfounded. The numbers of people taking out lifetime mortgages is soaring year by year and more products are coming onto the market. Equity release can be a fantastic option for homeowners over the age of 55 to free up cash. By doing this you will be able to do the things you have always wanted to. The next step is to find the right plan, the one that is most suitable for your requirements and the right adviser.

A lifetime mortgage will allow you to access a portion of your home’s wealth

In the latest blog from Paxton Equity Release, we go through the most common myths surrounding equity release and misconceptions. This is aimed at putting your mind at rest so that you can get more out of your life. A lifetime mortgage is the most popular form of equity release and you could access a portion of your home’s wealth as a lump sum.

I will lose ownership of my home

This is a big worry for homeowners when they release equity, as their home is very dear to them. Retaining ownership is dependent on the criteria of the plan that you take out. All lifetime mortgage plans, which are the most common, will grant you full ownership. With this type of mortgage, you are receiving a loan against the value of your property and you are not selling it. Home reversions, which are less popular these days, also allow you to retain ownership, but it is part ownership.

I will inherit debt

This is something that many older people do not want to incur for themselves and their family. This is actually a rare occurrence and with an equity release mortgage from Paxton, this is not going to happen. You are assured of a no negative equity guarantee. In simple terms, this means that however much you owe, you won’t have to pay more than the value of your property. It is important to remember that repayment of equity will only happen when you and your partner move into long term care or you pass away.

I will not be able to move home again or switch plans

This is another one of the myths surrounding equity release. Again, this is false as you will be able to move homes. Many plans allow for downsizing and will allow you to move house without incurring any additional fees. You should also be able to switch to a better deal. And why not, if there are more beneficial plans available for you?

I will have to make monthly repayments

You can choose to make monthly repayments, but there are no mandatory monthly payments. Depending on the plan that your take out, you can make optional, penalty-free repayments of up to 10% per year of the mortgage balance.

Get in touch with us if you have any questions about equity release

We hope we have managed to clear up some of the myths surrounding equity release in this article. These are some of the main concerns that people have, but there may be others you have. If there is anything else that you require explanation of in reference to an equity release mortgage, please do ask Martin from Paxton Equity Release.

How Paxton Equity Release can help you to acquire a lifetime mortgage

Martin from Paxton Equity Release will be delighted to go through your options. This will determine whether an equity release mortgage will meet your needs and circumstances and be the right choice for you and your family. Please call Martin on 01892 617070 for a chat or email martin@paxtonuk.com

Myths surrounding Equity release explained.

Plans On Hold – Could Equity Release Be The Solution?

Plans on hold?

Plans on hold – could equity release be the solution? There are few people who haven’t felt the significant impact of the pandemic both in human and financial terms. Perhaps you like many others are finding that you do not have enough savings to cover the financial effects of doing the things you would love to do.

Maybe sources of income have dried up or expected returns are much lower than you were hoping for? Maybe projects you had planned cannot proceed in this climate when money is so tight? In the latest article from Paxton Equity Release, the specialists for lifetime mortgages based in Tunbridge Wells in Kent, we look at why you may have shortfalls in income and what you can do about it. We also consider the things you would love to do if you had the money and why an equity release mortgage could be the perfect way to raise funds.

What you can do with an equity release mortgage?

Are your plans on hold for some of the following things you would love to do if you had the available money?

You may be receiving less income:

Certainly the crisis has made many people evaluate their lives and look at things differently. Coronavirus has meant that many are not in such a strong financial position, as they were at the beginning of 2020 and have had to put plans on hold.

  • Dividend shares have been stopped or cancelled or are less than you were expecting
  • Your investments and shares are worth less and it’s not a good time to sell
  • You no longer feel in charge of your finances

Could equity release be the solution for the plans you have on hold?

Equity release can give you the financial flexibility you are looking for

Do you own your own house? Are you thinking how unfair it is to have most of your money tied up in your property, leaving insufficient funds for the other expenses of life? It’s actually possible to release equity and raise money from your home if you meet eligibility criteria. If you are over 55, take note NOW! There is a wonderful flexible mortgage scheme available to you and all it needs is triggering. Lifetime mortgages, also known as equity release mortgages can be an excellent way of releasing those locked in funds from your home to ease your financial worries. Those plans on holdthat you have could soon be a reality.

How does a lifetime mortgage work?

First of all, decide what amount would relieve your final worries today? Lifetime mortgages are often structured as an initial drawdown to cover your immediate needs, plus a reserve, which can be drawn at the time you need it. It is a bit like you having your own bank; you can take further amounts as and when you require them. Now, doesn’t that sound like the perfect scenario to raise the necessary funds?

How can Paxton Equity Release help you?

So, if you have plans on hold, Martin from Paxton Equity Release will be delighted to go through your options to see whether equity release will meet your needs and be the right choice for your family in these current difficult times. Do ring Martin Greensted at Paxton Equity Release for a free appraisal on 01892 617070. You could soon find that all your financial worries are a thing of the past.

Plans on hold?

Equity Release Eligibility – Do You Qualify?

Equity release is becoming more and more popular as homeowners look to access some of the monies tied up in their houses. With the increase in house prices over the years, many people are in a situation where they have most of their money tied up in their house. Equity Release appeals to many homeowners as it allows them to maintain full ownership of their home and release tax-free money. In this article, we go through equity release eligibility criteria and whether you would qualify.

Would you qualify for an equity release mortgage?

The factors that affect your eligibility:

  • Age of the youngest homeowner
  • Value of your property
  • Where you live
  • How much you would like released

In a nutshell, if you are 55 or over, and that’s for the youngest person if you are a couple and you own your home in the UK, you may well be eligible for an equity release mortgage.

General equity release eligibility requirements

  • The youngest person, if a couple, must be aged 55 or more for a lifetime mortgage
  • For a home reversion scheme, where lenders become co-owners of your house, the minimum age is 65
  • Your home needs to be valued at £70,000 or more
  • The property has to be in the UK
  • You must be a UK resident
  • The property needs to be your main residence and in good condition and of standard construction
  • Leasehold properties will have to have at least 75 years remaining on the lease
  • You will need to be mortgage free or release enough equity to pay off an outstanding mortgage or loan
  • Freehold and leasehold properties can be considered

How old do you have to be to qualify?

A couple is considered to be if you are married, cohabiting or in a civil partnership and the youngest person must be 55 or more if you require a lifetime mortgage. For a home reversion scheme, the minimum age of the youngest person has to be 65.

What types of property will be considered?

It can be a house, a bungalow, a flat or a maisonette although it must be of traditional construction with the walls made of brick, stone or block and the roof of concrete, slate or stone tiles. But there are specialist lenders who will consider other constructions. Flooding, subsidence or structural issues must not recently have affected it. Properties can be leasehold or freehold.

How can Paxton Equity Release help you?

Martin from Paxton Equity Release will be delighted to chat with you as to whether you would be eligible for an equity release mortgage and if it would be the right option for you and your family. Over a cup of coffee or tea, Martin will talk through with you your different routes for raising money to make sure an equity release mortgage is the right choice for you.

Please call Martin on 01892 617070 for a chat or email martin@paxtonuk.com

 

The Bank of Grandad and Grandma – Would It Be A Good Option For You?

Bank of Grandma and Grandad

We have got used to the expression, “The Bank of Mum and Dad”, with reference to the financial support that parents can offer to their children who are struggling to get onto the housing ladder. However, today it’s grandparents who are increasingly helping family members to climb onto the first rung. A new term has come to the fore, “The Bank of Grandad and Grandma.”

In fact, a survey last year by Santander Mortgages discovered that 1 in 10 first-time buyers are now turning to their grandparents for financial support. This is a big increase from 5 years ago when the figure was just 2%.

Equity Release – Advantageous for the family and grandparents

For many grandparents it is something that they want to do whilst they are still alive, so that they can enjoy seeing younger relatives in a home of their own. Many grandparents are asset rich but cash poor and so it may be an option to consider an equity release mortgage. Here, capital is released from their home without them having to move. This can be a solution that may be advantageous to the family and to the grandparents themselves.

Drawdown Lifetime Mortgages

Quite often drawdown lifetime mortgages are the most popular as they will enable you to release equity when you need it. The interest that this type of mortgage accrues is only repaid when you pass away or you and your partner go into care. The mortgage will pave the way so that you can give your children or grandchildren an early inheritance. It also has the advantages of paying off your mortgage, if you wish and providing you with money during retirement.

What to consider before helping the family

However, as a grandparent, there are things that you must consider before you take on this arrangement.

  • Are you gifting the money or is it a loan?
  • Are you set financially for the future?
  • Can you really afford to lend the money?
  • What will happen if the family member splits from their partner?
  • If you are loaning the money, will the recipients be able to pay you back later?

A Big Decision – Ensure you get the right advice

It is certainly a big step and your generosity and providing the Bank of Grandad and Grandma will almost certainly be really appreciated. However, you must consider your needs as you grow older. This means that it’s important not to gift or loan more than you can actually afford. The decision to take out an equity release mortgage should not be taken lightly. It will impact on the value of your estate and it may even affect your state benefits entitlements.

How can Paxton Equity Release help you?

Martin from Paxton Equity Release is an experienced equity release mortgage adviser and will be delighted to go through your options. He will sit down with you and discuss what is best for you and your family over a cup of coffee or tea. You will then have all the facts to take to your financial advisor should you feel that is necessary. Please call Martin on 01892 617070 for a chat or email martin@paxtonuk.com

You can help your grandchildren with financial support from an equity release mortgage

 

Is An Equity Release Mortgage Right For Me?

 

An Equity Release mortgage for many people is a practical and sensible way of releasing cash from their homes, so that they have the money available to do the things they want to do. However, taking out this type of mortgage shouldn’t be taken lightly and it’s important that you know all of the facts and implications before you commit. An equity release mortgage isn’t right for everyone!

Why would you want to release cash from your home?

First of all, let’s have a look at the types of people this mortgage would suit. And before going any further, you do have to be over 55 and a homeowner.

  • You love your home and want to stay there
  • You need some tax-free cash to enjoy life to the full
  • You want to supplement your income and/or pension
  • You want to give a grandchild a deposit on their first home
  • You would like your family to benefit now, not after you have passed away

An equity release mortgage will allow you to stay in your home

Many people love their home and don’t want to move but find themselves asset rich, but cash poor. With an equity release mortgage, you can continue to live in your home for the rest of your life or until you move into permanent residential care. In most cases, you won’t have to make regular payments unless you actually want to because the amount you owe is paid back from the sale of your home after your death.

You will have cash to enjoy life

The tax-free cash that is released from your home can be used for a host of things ranging from home improvements including an extension or new kitchen, holidays such as a cruise, a new car or caravan, paying off a debt or mortgage or just enjoying days out.

An equity release mortgage will supplement a pension shortfall

The release of a lump sum can be used to supplement your income and pension. When retirement does come around, you may find that you haven’t planned properly and you have a shortfall in monies coming in each month and this is where an equity release mortgage could make up the deficit.

You can financially help your family

Many people want to help their children or grandchildren, particularly if they are struggling to get on the housing ladder. Giving a family member a lump sum could fund their deposit and enable them to make their first purchase. It’s something you would love to do for them now, so they don’t have to wait until you have passed away.

How can Paxton Equity Release help you?

Martin from Paxton Associates will be delighted to go through your options over a cup of coffee or tea so that you can see whether an equity release will meet your needs and circumstances and be the right choice for you and your family. Please call Martin on 01892 617070 for a chat or email martin@paxtonuk.com