Equity Release Hounslow - Lifetime Mortgage Near Me

Lifetime Mortgage & General Equity Release Advice in Hounslow
Reviewed by Tom Philips

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Equity Release Hounslow & Near Hounslow

Equity release Hounslow is a great way of gaining access to additional funds and money whilst you remain living in your house.

Equity release is a long-term loan and arrangement, which will be repaid when you eventually pass away or move into long-term care, when your property will be sold. The money from the sale of your property will contribute towards paying off the equity release loan.

Until this happens, you will be able to remain living in your home, and will not be asked to leave at any stage or have to pay any rent on your house.

There are lots of different types of equity release Hounslow and across the rest of the UK. However, there are two popular forms of equity release, which are lifetime mortgages and home reversion plans.

Which plan will be best for you depends on a number of different factors, which include your age, your finances and your current state of health.

When you opt for equity release, you will be able to gain access to your funds either in long large lump sum, or through a number of small and frequent payments each month.

Before you sign on the dotted sign, you must speak with an equity release specialist who will be able to help and advise you on the best equity release plans for you and your family.

Who Can Get Equity Release?

According to Age UK [1] there are a number of conditions and qualification criteria you must meet in order to qualify for an equity release loan.

For example, for a lifetime mortgage, you must be at least 55 years old, and for a home reversion plan you must be aged at least 65 years old in order to qualify.

You must also own your own property in the UK, which must be your main residence and must also be worth over £70,000 in value [1].

Your property must also be kept in good condition, as this will be assessed during your valuation with the lender.

The valuation is a necessary part of the equity release process as it informs the lender on how much your property is worth, and therefore how much equity you would be able to release.

If you still have a mortgage, then you will need to have paid off a large amount of this mortgage in order to qualify for equity release in Hounslow. However, you might need to pay off the entire mortgage before you qualify for your equity release funds.

It is also worth noting that if you live with any other dependents, such as children, a lodger or a parent, then you might not qualify for equity release unless they seek separate legal advice and sign a contract or waiver.

They will need to do so to confirm that they understand that they do not own the property and that they do not have the right to stay in that property after you pass away or move into long-term care.

Equity Release Hounslow is Increasingly in Popularity

There is no denying the fact that equity release is becoming increasingly popular, across Hounslow and the rest of the UK. There are many different reasons why this is the case, as there are many different benefits and pros to equity release in Hounslow.

One of these reasons is that there are now a lot of new and exciting equity release plans in circulation, which offer more flexibility and certainty than ever.

There is also a long list of new societal reasons why individuals aged 55 or over would need to release equity from their home.

More and more people are hoping to add more value to their homes and properties through home improvements, whilst others are needing to dip into their equity in order to fund a new car, a holiday abroad or to help family and friends who might be struggling financially.

In addition to this, the risks that have surrounded equity release over the past few years are slowly dying out due to an increase in education and exposure around equity release.

Lifetime mortgages have also been increasingly popular across Hounslow and the rest of the UK, and have been a large contributing factor in the growth and popularity of equity release.

This is mainly because lifetime equity release mortgages offer individuals more flexibility and freedom when it comes to their cash and equity.

You are also now able to spend your equity release in whichever way you want, which means that more and more people are choosing equity release in Hounslow.

Releasing equity in your home is a huge decision, and one that should not be taken lightly.

If you are considering equity release in Hounslow, then you should speak to a member of the equity release team at Equity Release Warehouse to see if you are eligible for equity release and to see if it is right for you.

Why Should You Choose Equity Release in Hounslow?

There are many different reasons why people consider equity release in Hounslow. Whilst every reason and situation might be different, it is important to understand that no one will force you into a decision, even if your reasons for choosing equity release are the right ones.

For example, some people choose to release equity from your home because they want to make some home improvements, such as an extension or proofing their home for the future as they age.

Depending on your current health and mobility, you might want to optimise your property for you and future-proof your environment as you age.

Other people choose to renovate and refurbish their home to make it as comfortable as possible during their retirement.

However, other people choose to release equity from their home in Hounslow because they want to increase their retirement funds and make their lifestyle more exciting and comfortable during their retirement.

If you suffer from debt or any private medical payments and bills, then you might choose to release equity from your home in one large lump sum to help to pay these off.

Other people choose to use their equity release funds on their family, friends and loved ones. These funds might help to go towards a house deposit or University fees for a grandchild.

Others might choose to start savings account for their children or grandchildren, to ensure that they grow up to live a secured and financially stable life.

If your child or grandchild is getting married, then you might choose to spend your equity release money on their wedding.

If you still have a remaining mortgage, then you might also choose to pay off your mortgage first, so that it is taken care of immediately. You are then able to spend your remaining equity release on whatever you want.

What Happens to My Debt, Inheritance and Tax Benefits?

As with every debt and loan, there are always pitfalls and cons. When it comes to equity release in Hounslow, there are very few pitfalls. However, debt, inheritance and tax benefits are a few of them.

Every equity release scheme should be standardised and benefit from a no negative equity guarantee. This means that you will not leave your next of kin with any debt left from your equity release scheme.

You will never have to repay more money than the value of your house. If your house does not sell for enough, then the bank and lender are liable to cover the differences.

Whilst this is a fantastic feature of equity release schemes, the sale of your house will be going towards paying off your equity release scheme.

This means that any inheritance you leave to your loved ones and next of kin will be reduced, which is something that you should speak to your loved ones and next of kin about before you take out your equity release scheme.

It is also worth remembering that when you release equity from your home, this has the potential to change your current and future tax position, and will also alter your position and eligibility for any means-tested or welfare benefits, which will include pension credit and any support you receive or are due to receive from the council.

If you do currently receive some of these benefits, then you should speak to your equity release advisor about this to see what it would mean for you.

If you would like more information on the drawbacks of equity release in Hounslow, then visit our page on the disadvantages of equity release.

Equity Release Council Standards

The Equity Release Council set a number of standards when it comes to equity release products, advisors and lenders.

This is to ensure that individuals are accessing fair and responsible equity release schemes and that no lender will offer a bad or unfair investment to individuals [2].

The Equity Release Council is constantly adding to their list of standards, but some of these standards are listed below.

For example, all lifetime mortgages must benefit from fixed interest rates. However, if they are variable interest rates, then they must benefit from an upper limit and maximum interest rate and this must last for as long as you live.

According to the Equity Release Council’s standards, every equity release scheme must last for as long as you live, and you are allowed to stay in your home for the rest of your life, if that is what you choose to do.

However, your property must remain as your main residence and you must follow your contract closely over the years.

It is also important to understand that according to the Equity Release Council standards, you are also able to move house if you choose to do so, then your new lender must take on the equity release loan and the new property is suitable to be used as security for your equity release loan.

If you would like more information on how to move house after taking out an equity release scheme, then visit our page on Can I Still Sell My House?

It is also standard across the industry that when your next of kin sells your property, then your next of kin will not be liable to pay off any debt, even if the sale of the property does not cover the loan amount.

The equity release provider will always be liable to pay off the debt after you pass away.

Importantly, the Equity Release Council also asks all individuals who are considering equity release to speak to an equity release advisor prior to making their final decision.

They will also need to seek independent legal advice before signing on the dotted line. This is so that they are fully informed on their decision, and they have been presented with all of the available equity release options that they would qualify for.

It is important to understand that by seeking the advice of an equity release advisor from Equity Release Warehouse, you are not committing yourself to releasing equity. Instead, you are simply gaining advice from qualified individuals.

It is highly important that before you enter an equity release scheme, you need to be fully informed and educated on equity release.

You will need to fully understand the advantages and any disadvantages to your chosen equity release scheme, and will need to carefully read and understand the terms and conditions behind your equity release plan.

Before you enter an equity release plan, you should check to see that you have a full understanding of the following things:

All of the associated costs of an equity release plan, including the cost of a valuation and the cost of a solicitor
What will happen if you ever want to move house to another property in the future
How taking out an equity release plan will affect any tax benefits or means-tested benefits that you are currently receiving
How the changing housing market might affect your property price in the future

If you would like more information on the Equity Release Council Standards, then take a look at their website and list of standards.

Alternative Options to Equity Release in Hounslow

If you do not qualify for equity release in Hounslow, then there are a number of different alternatives that might suit you and your current situation better.

There are a number of different ways individuals who are aged over 55 years old are able to raise some cash and live a more comfortable life. Some of these alternatives are listed below.

1. An Unsecured Bank Loan

Some people might not need to release equity from their home because they only need and want to release a small amount of money. If this is the case with you or someone you know, then you should consider an unsecured bank loan.

This might work out cheaper for you in the long run, and it will mean that you can pay back any interest payments through your income, as the loan is only for a small amount.

It is important to have a good look at different types of bank loans across different lenders, so that you have a good idea of what loans are best for you financially.

An easy way to do this is to search through the Financial Conduct Authority’s website [3] as this will suggest a range of different and fully qualified contacts and advisors. Some of these might charge you an initial fee, whereas others will not.

2. Adapt your current mortgage

If you are still paying off your current, pre-existing mortgage, then some banks might allow you to extend your mortgage term, which will allow you to release some extra money.

However, this does depend on what type of mortgage you are on, your current age and your current health status, similar to an equity release scheme.

Once again, if you are looking for more information on this then you should seek advice on the Financial Conduct Authority’s website [3] for advice and support on how to extend and adapt your current mortgage to release some funds.

3. Downsize Your Property

If you are struggling for money and are hoping to get some more money into the bank and out of any assets, then you should consider downsizing your house.

This is where you sell your current property and buy a cheaper property. By doing this, you will have some extra money in the bank for you to spend however you want to.

However, it is worth noting that if you opt to sell and downsize your property, you will need to pay legal fees and for a valuation as part of the sales process, as well as any stamp duty that you are liable to pay, depending on the size and value of the property and where you live.

It is obvious to note that not everyone is in a position to downsize their property, as their family might be too large or they are simply unable to move.

4. Benefits

If you are struggling on a low income and would like help on the cost of living, then you might be eligible for some form of benefit or grant from the local council authority. However, this often depends on a number of different factors and might not be the best option for you.

If you think that you might be eligible for benefits or grants, then you should speak to an appropriate member of our council for help, advice and support.

Alternatively, you can take a look on the Age UK’s website, at their benefits calculator to see what benefits you might be entitled to.

How Long will My Equity Release Application Take to Process?

How long your equity release application and plan will take to process depends on a number of different factors, including who you choose as your solicitor and your lender.

However, the general rule of thumb is that you should be expecting to wait approximately 8 – 10 weeks from the first application submission until you receive your funds in your account. This is very similar to the time frame of buying a house.

However, less complicated equity release applications can be carried out quicker than this, and more complex plans do typically take longer.

Unfortunately, there is no way of paying more money to speed up the process, as it generally takes as long as it takes.

Myths Surrounding Equity Release in Hounslow

Below, we outline some common myths about equity release:

1. You Will Leave Your Family in Debt

There is a huge misconception surrounding equity release in Hounslow and the rest of the UK that by opting for an equity release scheme, you are taking money and inheritance away from your next of kin, and will even be leaving them with debt.

However, this is not the case. In fact, the Equity Release Council has made a no negative equity guarantee mandatory across all equity release plans and products, to ensure that this does not happen.

A no negative equity guarantee ensures that you will never owe more than the value of your home when it is sold, so that you will not leave your next of kin with any pressure or debt off of the back of your equity release.

If your property is sold for less than the amount of your equity release loan, then the equity release lender pays the difference, not you or your next of kin.

2. Monthly Payments are Mandatory

When you opt for equity release in Hounslow or anywhere else in the UK, there are no monthly repayments included. You are able to opt to pay off any interest on the loan, but this is entirely up to you.

If you decide that you do not want to repay any interest, then the compounded interest will be paid off upon the sale of the house, after you pass away or move into long-term care.

3. Your Home is No Longer Yours

If you opt for equity release in Hounslow or across the UK, you will always own your home for as long as you live. When you opt for a lifetime mortgage, you are simply borrowing against your home, not selling your home.

If you opt for a home reversion plan, then you will sell a percentage of your property to the equity release lender, in exchange for access to your equity as cash. However, home reversion plans are a lot less common and less popular than a lifetime equity release mortgage.

Your equity release plan lasts as long as you live and there will not be a fixed end date. You are also able to move house in the future, if you choose to do so, but your lenders will need to agree to meet the equity release providers’ rules and standards.

4. You Must Have Paid Off Your Mortgage

If you still have a mortgage when you apply for an equity release scheme, you might still qualify. However, it is recommended to use your equity release to pay off the existing mortgage on your home, and some lenders do ensure that this is something you will do once your funds are released to you.

5. Equity Release Interest Rates are Too High

Although interest rates on an equity release plan are higher than they are with a traditional mortgage, many people are surprised at how cheap and cost-effective equity release mortgages are, considering the benefits you get with them.

Over time, equity release providers have worked at increasing the flexibility of their plans whilst trying to reduce the interest rates.

This means that your interest rates and repayments will be smaller, and you also have more flexibility than ever when it comes to how you want to pay them back.

For example, individuals are now able to avoid compound interest by choosing to pay back the interest on their equity release scheme in small, monthly payments.

The interest rate on your equity release loan will also be fixed for life, meaning that, unlike with a traditional mortgage, your interest rates won’t move up or down.

As a result of this, you should know how much you are due to pay back on your equity release loan for the rest of your life, and there won’t be any sudden or nasty surprises.

Get in Touch with Equity Release Warehouse

If you would like more information on equity release in Hounslow, then speak to a member of our friendly and professional team at Equity Release Warehouse. Our advisors are on hand to support and advise you.

It is important to understand that by getting in touch with our team, you are not making a commitment to us or equity release.

Our advisors will not pressure you into making a decision, and are simply here to guide and support you through the process whilst answering any questions that you might have.

Our advisors will also use our very own equity release calculator to work out the best equity release plan and lender for you, taking into consideration the value of your home, your age and how much equity you wish to release.

Speak to our team today by calling us on 0330 058 1579 or by visiting our website and requesting a free equity release brochure.