Over 20 years experience
Equity ReleaseGuidance
A growing number of homeowners are discovering the age-old saying of becoming 'property wealthy but financially constrained' to hold true, as the value of their homes significantly surpasses their retirement savings.
Planning for retirement is crucial, especially as retirement approaches or you consider reducing work hours. To supplement your pension, you might think about downsizing to a smaller home or exploring equity release.
Wondering where to find trustworthy equity release advice?
Look no further. At Paxton Equity Release, our experienced advisers are here to guide you through your options. We're dedicated to providing unbiased information so you can make the right choice, whether it's equity release or an alternative path.
Let's delve into guidance onEquity Release
Let’s explore some of the main reasons why equity release advice is so important.
To assist you in determining the optimal age for considering equity release
Equity release becomes an option for homeowners starting at the age of 55. However, it's important to note that at this age, the borrowing amount is relatively lower compared to older homeowners. Lenders typically employ a sliding scale, where the amount you can borrow increases as you get older.
Initiating an equity release scheme at a younger age is closely regulated by lenders, who limit borrowing amounts accordingly. Because of this, if it's feasible to postpone equity release, we strongly recommend doing so. This delay can help prevent a substantial accumulation of interest over time.
Modern lifetime mortgage plans now offer various flexible features to address the accrual of interest, including options for voluntary payments to minimize the impact of compound interest.
Nevertheless, many borrowers opt not to make monthly interest payments on their equity release plans. Instead, they repay the borrowed amount along with the accumulated interest when the plan concludes, typically upon the final borrower's passing or transition into permanent care.
It's crucial to understand that forgoing interest payments will result in a significant increase in the amount of interest to be repaid over time. As an example, a plan with a 5% interest rate will cause the overall debt to double approximately every 14-15 years.
Because the age at which you choose to initiate an equity release plan has a substantial impact on both the borrowing amount and the eventual repayment, this decision is highly personal. A specialist adviser from Paxton Equity Release will be happy to assist you in navigating this process and tailoring a plan to your unique circumstances.
Assisting You in Discovering the Perfect Plan
In the realm of traditional mortgages, the deal offering the lowest interest rate is typically considered the best choice. This approach makes sense as it translates to lower monthly mortgage repayments.
However, when it comes to equity release, this conventional wisdom often doesn't apply. Equity release plans typically do not involve monthly interest repayments, and they come with a wide array of features and options.
So, which equity release plan is the right fit for you? The answer hinges on your individual circumstances, both in the present and the future.
For those with children, a plan that ensures an inheritance for them might be a priority. If you anticipate repaying your plan in full down the line, you may prefer a plan with early repayment charges that gradually decrease over time. Additionally, if you have any health conditions, enhanced plans could potentially allow you to borrow more.
Given the multitude of plans and options available, it's of utmost importance to discuss your financial goals and future objectives with your local Paxton Equity Release adviser. They possess the expertise to scour the entire marketplace and identify the perfect solution tailored to your unique needs.
To Assist You in Securing and Maintaining Means-Tested Benefits
If you are currently receiving means-tested benefits such as Pension Credit or Council Tax Support, it's important to be aware that your eligibility may be impacted when you opt for an equity release plan.
However, determining how equity release may affect your benefit entitlement isn't always straightforward. The outcome depends entirely on your unique circumstances and the specific equity release scheme you choose.
Your local Paxton Equity Release adviser can provide valuable assistance on two fronts. First, they can offer an indicative benefits analysis to help you understand and potentially secure any entitlement you may be eligible for. Second, they can ensure that your benefit entitlement remains unaffected when you decide to proceed with an equity release plan.
