16/04/2023
Update – April 2023
Lifetime Mortgages from Lancashire Equity Release (part of - Yorkshire Equity Release)
After years of working hard to make monthly payments to own your property your home is now likely to be your biggest asset – particularly you have benefitted from an increase in house values over the last 25 – 30 years!
Like most people – including ourselves – this equity is often passed onto family as inheritance when we are no longer here! However, an increasing number of people are tapping into some of this wealth to benefit themselves and their family now.
If you are a homeowner aged 55 years or over you could join the thousands of those already choosing to benefit from this money they have unlocked from their home.
You can use the money – minimum release is £10k – as you please.
Often we see the released money being used to repay the current mortgage or for home improvements but, increasingly to help younger members of the family with house purchase deposits (early inheritance). Other popular reasons are repaying credit cards and loans and for luxury items – new cars; motor homes and holidays etc.
Much has been written about Equity Release or Lifetime Mortgages – a lot of it on Social Media by people who haven’t carried out any research at least in the last 4 or 5 years!
It is important to confirm that any Lifetime Mortgage recommended by Lancashire Equity Release are regulated by the FCA – the Financial Conduct Authority – whose primary role is to protect customers and enhance the integrity of the financial markets.
All Lifetime Mortgages we advise on are also from lenders who are members of the Equity Release Council which guarantees that all plans comply with the latest standards.
People I talk with often say things like “It sounds really good” what’s the catch? Our answer is “There is no catch”, however, there is a downside and that is the roll-up of interest which will reduce the amount of equity which will we available for your beneficiaries when you are not here anymore.
We will always advise that, when your budget allows, you pay the interest or part of the interest to offset the roll-up. All plans will allow you make capital payments of up to 10% of the amount borrowed each year (some will allow more)
Many people have no intention to make any payments and as most plans have a fixed interest rate for life, we will provide a calculation to show how the amount borrowed will increase over time.
When we talk with you about your plans for your release we only advise you to release the monies that you intend to spend, usually, during the first 24 months. We don’t want you to pay more interest to keep the money in your Current account. Many plans will allow you to not only take an initial lump sum but, also provide a Reserve or Drawdown facility allowing you to take minimum amounts as you require.
We will obviously, based on your individual requirements explain all options available to you and I have provided answers to some of the most often asked questions under our FAQs heading, however, it is important to mention one question and the answer here!
The question in two forms – “Will I still own my house” and Could I lose my home”
Yes – you’ll still own your home and can stay in it for as long as you wish; as there are no contractual monthly payments to make with a Lifetime mortgage you cannot fall behind with any payments and, therefore, it is impossible to lose your home. You are guaranteed that you can stay in your home until you either pass away (both of you if you’re a couple) or you have to move into long term care.
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