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Equity Release in Warwickshire - Lifetime Mortgage Near Me

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

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Equity Release in Warwickshire & Near Warwickshire

Equity release was first introduced to the UK in the 1960s, but it didn’t become popular until around 10 years ago. Since then, equity release plans have been modernised, which makes equity release in Warwickshire safer than it’s ever been.

For example, in the past, it was difficult to balance leaving an inheritance with equity release, but now, inheritance protection is a key part of most Warwickshire equity release schemes.

Another example is that you didn’t used to be allowed to repay your equity loan at all, so you were stuck with the equity release scheme for the rest of your life.

However, now there is often the option to pay an early repayment fee, and we have plans that are designed to encourage you to pay back the loan early.

Overall, equity release is now much more flexible and you can trust the process more than you could when it was new to the market.

Some people still worry about the safety of equity release in Warwickshire, but you must remember it is regulated by the Financial Conduct Authority, so it is above board.

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Why Do Homeowners in Warwickshire Decide to Take Out Equity?

There are many reasons Warwickshire homeowners decide to take out equity, and we cannot cover them all in this article. However, we will give you several reasons.

1. They Are Cash Poor

Many equity release consumers in Warwickshire are cash poor and need to find another way of accessing money aside from their pension funds.

Perhaps they have worked for many years and are paid a monthly pension, but they still can’t pay the bills. Or perhaps they are still working a poorly paid job and have never been completely financially secure.

2. Their Property is Valuable

It is a requirement for an equity release consumer to have a property that is worth at least £70,000, so in this sense, all equity release customers will have a valuable property.

However, people with particularly high value Warwickshire properties may be more likely to consider equity release as they could access a large loan that does not need to be repaid while they are alive.

3. They Want to Purchase a Second Home

Some people want to purchase a second home in retirement, often to use as a holiday home. They find that this brings joy to their life in retirement, and it also benefits their family, who may be able to stay in the home too.

Without an equity release loan in Warwickshire, they might struggle to afford a second home, so the loan gives them the push they need to purchase a new property that they can enjoy for the rest of their lives.

4. They Want to Help Out Their Loved Ones

If a pensioner wants to give money to their loved ones and does not have the means to do this, they could take out an equity release loan in Warwickshire to get access to money immediately, with the knowledge that the eventual sale of their home would cover the cost of this.

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Should I Be Wary Of Equity Release Scams?

Yes, you should always be wary of scams when you are putting your property at risk. However, as we have mentioned, equity release in Warwickshire is very well-regulated, so as long as you find a reputable adviser, you can trust the safety of the process.

This includes finding a financial adviser and a solicitor that is trained in equity release and has good reviews.

Are there any disadvantages to equity release?

Equity release is essentially a loan, which must be repaid one day. The principal disadvantage of equity release is that it may not be the cheapest form of borrow. Also, equity release will reduce the size of your inheritable estate when you die.

We outline the costs involved and the potential alternatives here.

Also, if you are releasing equity to combat the cost of living, then it might be better to first try to see if you can better manage your budget. Below, we list organisations that may be able to help in Warwickshire:

1. Citizens Advice South Warwickshire

Address: 10 Hamilton Terrace, Leamington Spa CV32 4LY

Telephone: 0800 144 8848

Website: http://casouthwarwickshire.org.uk/

2. Citizens Advice South Warwickshire

Address: 25 Meer St, Stratford-upon-Avon CV37 6QB

Telephone: 0800 144 8848

Website: http://www.casouthwarwickshire.org.uk/

3. North Warwickshire Citizens Advice

Address: The Parish Rooms, Welcome St, Atherstone CV9 1DU

Telephone: 01827 712852

Website: https://nwcab.org.uk/

4. Age UK Coventry and Warwickshire

Address: Alvyn Smith House, 7, Warwick Row, Coventry CV1 1EX

Telephone: 024 7623 1999

Website: https://www.ageuk.org.uk/coventryandwarwickshire/

5. Age UK Coventry and Warwickshire Charity Shop Warwick

Address: 10 Swan St, Warwick CV34 4BJ

Telephone: 01926 410716 

Website: https://www.ageuk.org.uk/coventryandwarwickshire/

6. Age UK Warwickshire
Address: 8 Clemens St, Leamington Spa CV31 2DL

Telephone: 01926 458100

Website: https://www.ageuk.org.uk/coventryandwarwickshire/

You can find further resources of this nature on Warwickshire Council’s website.

What Will a Good Equity Release Adviser Do?

A good equity release adviser in Warwickshire will listen to your concerns and allow you to express any negative views you have of equity release, rather than solely focusing on the positives.

They will discuss the dangers of equity release and the ways it can leave you financially vulnerable, but they will also sing its praises when it comes to its positive points.

Another thing a good equity release adviser will do is provide tailored equity release advice rather than general advice that you could find on any website.

This means they will ask questions about your finances and your goals with equity release so that they can recommend the best plan for you in Warwickshire.

Finally, they will offer a personalised illustration showing the features and risks of equity release for you and your family. This should cover the immediate effects of equity release, as well as the future implications.

Please call our 24-Hour Helpline: 0330 058 1579

What Will a Reputable Equity Release Lender Do?

A reputable equity release lender in Warwickshire will explain their policies to you, which differ depending on the plan you choose to go with.

They will request a property valuation, after which they will make an appropriate loan offer if they are content with your property.

Unless there are delays for valid reasons, they should take only around a week to make an offer.

How Can a Solicitor Help With Equity Release in Warwickshire?

Solicitors are important for equity release in Warwickshire as they take control of the legal issues involved with equity release, and they read contracts to ensure the equity release customer is getting a suitable deal when it comes to the money they will receive and the rules they have to obey.

They also help with the administration as they will facilitate communication between the equity release lender and the homeowner, particularly when it comes to the offer, as they will often inform the homeowner of the offer as soon as the lender has made a decision.

You can instruct your own local solicitor during the process. It’s true our advisors will recommend solicitors, but you are free to appoint your own. This may be beneficial if you are applying under joint ownership or lasting power of attorney when you want to appoint the same solicitor who has dealt with the matter in the past.

Please call our 24-Hour Helpline: 0330 058 1579

What Type Of Property Do I Need to Have For Equity Release in Warwickshire?

As we have mentioned, your property must be worth £70,000 or more. Some lenders will request that the value is higher, perhaps more towards £80,000, but the accepted minimum amount is £70,000.

Of course, if your property is more valuable than this, you will usually be entitled to a higher loan, and you may receive other benefits as it is more beneficial for the lender to offer you a mortgage than someone with a low-value home.

The condition of your property is very important, and some lenders in Warwickshire are particular about this. Your equity release adviser will inform you of the standards the lender expects, but the property valuation will tell you whether the lender is happy with the condition of your home.

Some people worry that they will not be able to take out equity from their apartment or bungalow, and this is certainly not true. Equity release in Warwickshire is not just reserved for houses.

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What Happens to My Beneficiaries When I Release Equity?

We advise that our customers inform their beneficiaries that they are going to release equity, as this decision will affect them so they should be aware of this.

The reason the decision affects them is that when you take out equity, you are reducing the value of your property as you are withdrawing funds from it, which leaves less money for your beneficiaries when you pass away.

However, if you are determined to leave funds to your loved ones, you should find an equity release plan in Warwickshire that allows you to protect inheritance for your family, and this will ensure they are not left with no money.

Please call our 24-Hour Helpline: 0330 058 1579

Do I Have to Make a Quick Decision About Releasing Equity?

No, you do not have to rush to make a decision about taking out equity from your Warwickshire home. In fact, we would strongly discourage this, as you could end up making the wrong decision for you and your family.

For example, you could feel compelled to choose a voluntary repayment plan to avoid being in significant debt, but later realise that you would have preferred an interest only scheme to keep the interest as low as possible.

On the other hand, you could spontaneously decide to use Warwickshire equity release to purchase a second home through the second home plan, only to later decide that you would have preferred to spend the loan on renovating your current home.

As you can see, these decisions would most likely lead to regret, and you want to avoid this at all costs considering equity release is a lifelong scheme.

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Equity Release & Interest

You will have to pay interest on your equity loan, but just like the loan itself, the interest is not due until the end of the scheme, so you will never be expected to pay it while you are alive. It will be repaid when your Warwickshire home is sold, which happens when you die or move into long-term care.

Generally, the interest rates on equity release are lower than they are on traditional loans, but this is because the interest accrues over time, so it does amount to a significant sum. This is of course unless you select an interest only scheme, where you repay interest gradually, or a home reversion, where no interest is applied.

Equity Release & Tax

One great thing about equity release in Warwickshire is that you do not have to worry about paying tax on the loan you receive. This includes income tax, capital gains tax, and inheritance tax.

For more information, see our article ‘do you have to pay tax on equity release?’

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What Are the Best Equity Release Schemes in Warwickshire?

There are many different types of equity release in Warwickshire, including lifetime mortgages and home reversions. Neither one is better than another, as they all provide something different to homeowners.

Home reversions are attractive to equity release consumers as they involve a tax-free lump sum of cash, so if you need money very quickly, a home reversion plan is ideal. Another huge advantage of home reversions is that interest does not come into it, so you don’t have to worry about growing interest.

However, you have to sell a share of your home for less than its actual value, so you are getting less money than you would if you sold your property outright. You also risk reducing the inheritance you can pass on.

Most Warwickshire customers prefer lifetime mortgages as you remain the homeowner of your property and you get more of your money’s worth when it comes to your loan. You can also get started much earlier, as you only have to be 55 years old rather than 65 (1).

On the other hand, if there is not a no negative equity guarantee present, you risk having to pay back extra money if the value of your home reduces. What’s more, if you are currently claiming benefits, you may have these taken away if you take out a lifetime mortgage.

Please call our 24-Hour Helpline: 0330 058 1579

Speaking to an Equity Release Adviser About Equity Release in Warwickshire

The best way to learn more about equity release in Warwickshire is to speak to an expert directly, so we advise you to call us on 0330 058 1579 to do this.

We know that it can be tricky to decide whether to have a lifetime mortgage or a home reversion in Warwickshire, so we would love to help you navigate this decision by presenting you with the detailed pros and cons of each one.

On the other hand, if you are unsure whether you would like to release equity in Warwickshire at all, we would like to explain the alternatives to equity release, as we realise some customers would benefit from these before deciding to take out equity.

We know that 70% of equity release customers conduct independent research before speaking to an adviser, and we believe this is very sensible, so we encourage you to browse our website before accepting our free initial consultation (2).

All advisors we work with are regulated by the Financial Conduct Authority. This means you are covered under the Financial Services Compensation Scheme, and you lodge a complaint with the Financial Ombudsman Service (FOS) if you are unhappy about the advice you receive in relation to equity release.

All lawyers are regulated by the Solicitors Regulation Authority. If you are unhappy about the legal advice you receive in relation to equity release, you can lodge a complaint with the Legal Ombudsman.

Access help and advice today across Warwickshire in Alcester, Atherstone, Bedworth, Bilton, Kenilworth, Leamington Spa, Market Bosworth, Nuneaton, Rugby, Southam, Stratford-upon-Avon, Studley, Warwick and Wellesbourne.

Please call our 24-Hour Helpline: 0330 058 1579

References

[1] Equity Release: How It Works, The Risks And What To Know Before Tapping Cash From Your Home https://vigourtimes.com/equity-release-how-it-works-the-risks-and-what-to-know-before-tapping-cash-from-your-home/

[2] Majority research equity release before speaking to an adviser https://bestadvice.co.uk/majority-research-equity-release-before-speaking-to-an-adviser/

 

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