Equity Release

Equity Release

At JWA Financial Planning, we offer expert advice on all matters relevant to equity release. Get in touch with our team for professional financial services. We welcome our clients from Cardiff and the surrounding areas, including Swansea, Newport and Bristol.

WHAT IS EQUITY RELEASE?

Equity is the value of your home less any outstanding mortgages and debts secured against it. For those who have lived in their property a long time, you may have been lucky enough to see your property increase in value meaning you could now be sitting on a substantial amount of equity in your home. Equity Release enables you to get some of this money out.

There are a number of reasons why you may be looking to release some equity from your property, it could be that you don’t have the pension provisions needed to fund your retirement, you may be looking to carry out some home improvements or changes to your home to make it more comfortable in the longer term or it could just be that you want to book the trip of a lifetime or allow yourself the capital to boost your lifestyle during in retirement.

Important facts about equity release
It is important to be aware that there are restrictions on the types of property that may be eligible for equity release. 
Equity release can have an impact on state benefits and may have an impact on age allowance.
Equity release will reduce the amount of inheritance that will be left on your death.

Before deciding if equity release is right for you there are some other ways of releasing capital which should be considered, such as a retirement interest only mortgage or downsizing. Finding a new home of lower value and suited to your long term retirement needs should be considered as a way of releasing some money however if you have been in your home for many years and you feel settled, it may not be something you want or are willing to do.   

The importance of Advice
At JWA Mortgage Solutions our qualified & experienced Equity Release Mortgage Advisors can help you decide if Equity Release is the solution for you. We can help you determine if there are there are other ways of releasing the money you need and enable you to fully understand the implications of Equity Release products as well as the benefits. We recognise that whilst Equity Release is a hot topic right now it is also an area of concern for people which is why we pride ourselves on our honesty and transparency. We ensure you are equipped with all the information you need to make an informed decision about your future.

There are two main types of Equity Release which can be considered:

LIFETIME MORTGAGE

This is the most common type of Equity Release. You need to be aged 55 or over to be eligible and own your own home. As the name suggests it is a mortgage which is set to last for your entire lifetime, it is only repayable on death or permanent vacation of the property such as moving into long term care. 
There are various products available and the key difference to a usual mortgage  is that Equity Release allows the interest to roll up onto the loan meaning you don’t have to make any interest payments.  You should be aware that this means as the interest compounds the debt will continue to increase through the years.
Lenders can release the funds in one single lump sum, on a drawdown basis (you can release the capital as and when required through the years) or as a regular income. 
Lenders who offer equity release products are now offering lower interest rates therefore making lifetime mortgages a more attractive option then it has been in previous years.

Warnings: 
* A lifetime mortgage is a loan secured against your home and there are restrictions on the total amount you can borrow depending on the market value of your home.
* You will not be able to borrow the full value of your home.
* A Lifetime mortgage involves the sale of part or all of the equity in your home and will result in a change to the title deeds.
* There are options for the loan payments that you will need to make, including rolled up interest, fixed repayment, interest only plans etc. In the case of a rolled up interest plan it is important to recognise that when interest is added to the original loan amount this can quickly increase the total amount that you owe.

Note: The Financial Conduct Authority does not regulate some aspects of or Commercial Finance advice’

HOME REVERSION SCHEME

With a home reversion scheme, you can sell all or part of your property in return for a tax-free lump sum, a regular income, or both, but allows you to stay in your home as a rent free tenant for the rest of your life or until you permanently vacate the property such as going into long term care.
As you have the entitlement to stay in the property rent free the lender will discount the lump sum or provide a lump sum based on a reduced house value. The provider will continue to own a percentage share of your property, this means if your property value increases through the term of your policy the lenders share will also increase.
Home Reversion schemes are less popular than Lifetime Mortgages today and should be considered very carefully, that being said they can still be the right choice for some people.

If you are considering Equity Release as a method of releasing some of your equity call one of our experienced and friendly mortgage advisors today to find out more. We offer free initial consultations with no obligation and welcome family members to join you in any meetings. We understand there is a lot to think about which is why we give you the time you need to make any decisions with no pressure and welcome you to ask us any questions you have throughout the process.

For your peace of mind, we only work with lenders who are recognised and approved by the Equity Release Council, these lenders guarantee a “no negative equity” policy meaning you do not have to be concerned with leaving your loved ones with mortgage debt.

Contact

Contact JWA Mortgages today on

Technology Business Centre,
2 Alexandra Gate,
Ffordd Pengam,
Cardiff,
CF24 2SA
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