How does equity release work?

Interest is charged on the amount that you release with your equity release plan, with interest rates typically fixed for life. Our equity release products are designed to run as long as your home remains your permanent residence.

Your equity release is only due for repayment once all homeowners have either passed away or entered into long-term care, when the balance, including interest, is normally settled through the sale of the property.

An equity release plan may reduce the amount of property wealth available for you and your estate and may affect your entitlement to means-tested benefits. Our advisers will help you to consider your current and future financial needs before making a decision.

What happens if you are in arrears?

Arrears generally refers to any amount that is overdue after the payment due date for accounts Such as bridges and mortgages.

There could be any number of reasons for this, for example, you may lose your job or experience a change in lifestyle that means you have less disposable income. You could even just have a single month of poor budgeting. But however, it happens, the results will be the same – you will be considered behind with your loan repayments.

If you’ve gone into arrears, there are solutions to dis instructing the LPA receivers that take on the property.

There are solutions by way of bridging finance. There are also other solutions as a way to actually structure a sale in a way that allows you to still not be in a position with the properties sold under market value. So, all those three potential solutions can only be applied once you’ve spoken to a specialist, I’d say, like ourselves, where we have the ability to do an audit and check really, under what circumstances what could be done to facilitate you getting out of that position.

It’s a huge quagmire of complex legal finance and sales type issues and if you haven’t got comprehensive understanding of them already, then you could end up actually getting yourself thrown in from the fire pan into the fire type situation.

So as far as having that type of knowledge and working in this industry property for 30 years now, with our teams, we’re able to decipher really, which would be the best way of actually dealing with this particular problem. It is a big problem! It’s never really addressed or talked about. It’s swept under the carpet by the banks and by a lot of property companies because they want to talk about the good stuff.

But I think the most important thing revolves around it is your credit file. You must have a good credit file if you’re looking to do equity release, especially in this market after lockdown. Okay. If you think I will leave you in the audience in your safe hands and I will speak to you later. Thank you very much. You’re flying in and give me your assistance in hosting today’s show.

So, I’m going to try and break down some of these topics now regarding finding finance. Now I had maybe about five, maybe ten key things. I think that could be really useful for a lot of viewers out there to know about equity release. Number one; are you in a position where you are looking to start in the market? Are you already semi established and you want to now grow or are you quite established already and you’re looking now to take it to the next step, scale up to become a multimillion-dollar pound Corporation?

So those three questions come to mind now and all those three circumstances, there are particular things you need to do. So, if you’re just starting off, then I think one of the first things that a lot of people ask me is equity release doesn’t apply to me, but technically it does because you may have a friend, a business colleague, or family that want to support you in your journey. And if they can release equity or finance property with you, you’ve gotten trusted relationship you can set up contracts.