Equity release myths. There’s so much fake news out there at the moment. Here are two more of the biggest lies we see spread about equity release.
Equity release & equity release myths. Equity release is the practise of releasing equity from the value of your home in the form of tax free cash. It’s often used to pay for holidays, weddings, or simply to improve lifestyle. Equity release myths cause nothing but stress. Why anybody would want to make this process stressful is beyond me.
In a previous post we mentioned two of the most prevalent bits of misinformation we hear about equity release. How you’ll lose ownership & control of your property (wrong), and how you’ll owe more than the value of your home (also wrong).
Here are another couple of rumours that are absolutely false but we hear all the time.
You will have to stay in the same property for all your life
Absolutely not. Equity release takes the form of a ‘Lifetime Mortgage’ or ‘Home Reversion’. We deal with Lifetime Mortgages and refer home reversions on to a specialist partner.
With most Lifetime Mortgages, as with any mortgage, you can move home and transfer your Lifetime Mortgage to a new property. The principles of the process are the same, and as with any mortgage, will be subject to lenders and terms conditions.
You can also use a Lifetime Mortgage to move to a new home, whether this is a second-hand property or a Newbuild home.
You will leave debt to your family and loved ones
Clarity is needed on this point. Providing the terms and conditions of your agreement are met, no debt is left to your estate. On top of this you will never owe more than the value of your home once sold.
The concern is that the actions you take to help may, in the long run, become a hindrance. We appreciate that financial services can be confusing to any lay person. When it comes to big, important financial (& often family) decisions it’s easy to feel overwhelmed.
Often situations arise whereby the process or Ts&Cs haven’t been explained clearly enough. If a point of an agreement isn’t met then there will be consequences to that. Although this is no different to any other agreement you’ll sign. Don’t pay your Netflix subscription? Guess what, no Netflix until you do.
We’re not just here to point you in a direction and let you get on with it. We want to make sure everyone knows exactly what’s right for them. We want to make sure everyone is happy, everyone is informed, and nobody is still clinging onto any equity release myths. Get in touch for a chat about how equity release might be the answer for you.
‘Lifetime Mortgages are for over 55s only, may affect eligibility to state and means-tested benefits, and can affect the inheritance you may leave.’