Protected Equity
All Lifetime Mortgages that we recommend come with a no-negative equity guarantee, however some plans allow you to go further and protect a fixed share of the value of your home. For example, if you protected a 20% share in your home, you have a guarantee that a minimum of 20% of your property value is protected for you or as inheritance for your beneficiaries in the future. However, the more you protect the less capital you can release.
Impaired Life
Some providers will allow you to release more capital if you suffer from one of a list of health conditions.
Flexible Drawdown
New plans are available with a pre-agreed ‘cash reserve’. Like an overdraft, it is a facility that allows you to draw-down cash whenever you wish, if you wish to. Ideal for boosting income when required or for ad hoc purchases when they’re needed such as a new car, replacement boiler and so on. As interest is only added to the amount drawn out, they can work out much cheaper than other types of plans, depending on your needs.
A lifetime mortgage is a loan is secured against your property to provide you with a tax-free cash lump sum or a regular income to spend as you wish, with no monthly repayments to meet.
Interest is added to the lifetime mortgage loan throughout your lifetime, accruing at a fixed or variable rate. The loan plus interest is eventually paid back when the home is sold, usually when you move into long term care, or when you and your partner die.
You can typically release between 20-56% of the value of your home
with a lifetime mortgage, depending on your age. The minimum age is 55.
Advantages of a Lifetime Mortgage
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A lifetime mortgage gives you the choice of a cash lump sum or income with no monthly repayments to meet
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You retain full ownership of your home
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No negative equity guarantee
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Some lifetime mortgage plans let you guarantee an inheritance for your family
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All equity release plans are regulated by the Financial Services Authority
Disadvantages of a Lifetime Mortgage
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Interest rates are usually higher on a drawdown plan than they are on a standard lifetime mortgage
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There are restrictions on the minimum amount you can release
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The amount you can leave as an inheritance will be reduced
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The interest applied to the drawdown mortgage can grow quickly as it is compounded.
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You can't usually raise as much money through equity release with a drawdown lifetime mortgage as you could with a reversion plan, especially at younger ages
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If you repay the lifetime mortgage loan early, you may have to pay an early repayment charge.
This is a Lifetime Mortgage. These are only applicable to those 55 and over, and it could affect eligibility to state means-tested benefits and the inheritance you may leave. To understand the features and risks, ask for a personalised illustration.
Is Equity Release Safe?
It is fair to say that the equity release market of today is safer than it has ever been. Both Lifetime Mortgages and Home Reversion Plans are now protected by the industry watchdog the Financial Conduct Authority (FCA)
Financial Advisers who practice advising on Equity Release must now also have specific qualifications in this specialist field.
The market is also protected by the Equity Release Council
Mortgage and Protection Advice Centre considers the safety of its customers as paramount. As such, we will only recommend a plan that has met all the standards and guarantees set by the Equity Release Council. https://www.equityreleasecouncil.com/ Please be aware that by clicking on to the above links you are leaving Mortgage And Protection Advice Centre Ltd website. Please note that Mortgage And Protection Advice Centre Ltd nor HL Partnership Limited are responsible for the accuracy of the information contained within the linked site(s) accessible from this page.
Some of these guarantees are as follows:
The right to remain in your home for as long as you choose.
• The freedom to move to another property without financial penalty (subject to lenders' criteria).
• That you will never fall into negative equity no matter what happens to house prices in the future.
• Independent Legal Advice from a solicitor of your choice.
This is a Lifetime Mortgage. These are only applicable to those 55 and over, and it could affect eligibility to state means-tested benefits and the inheritance you may leave. To understand the features and risks, ask for a personalised illustration.
Equity release includes Lifetime Mortgages and Home Reversion Schemes. We can advise and arrange Lifetime Mortgages and will refer to an approved specialist for Home Reversion schemes.
