Equity release has faced a lot of negative attention over the years, leaving many people in Manchester wary of considering it. Even though this is the case, much of this negativity stems from the way equity release was previously managed.
Thankfully, with the introduction of new regulations by the Financial Conduct Authority and standards set by the Equity Release Council, the public perception of equity release is improving, and more people are considering it as a viable option.
Despite this, there are still mixed opinions about equity release online, leading some to question whether it’s the right choice for them.
In this article, we aim to provide an in-depth look at the pros and cons of equity release in Manchester, so you can make an informed decision about whether it’s the right option for you.
At Manchestermoneyman, we believe that taking out an equity release plan can offer many advantages for later life applicants. One of the biggest benefits is the ability to access the equity that has been sitting within your property.
Our equity release plan in Manchester is offered through a lifetime mortgage, with two options available: tax-free lump-sum or tax-free drawdown facility. With the lump-sum option, you receive a one-time payout in full. With the drawdown facility, you can withdraw equity as and when you need it.
When it comes to repayments, you have options. During the lifetime mortgage, you will have monthly interest payments, but you do not necessarily have to make them.
Many choose to let the interest roll-up, leaving them without monthly payments and more expendable cash. On the other hand, making payments can be beneficial if you wish to leave an inheritance for a family member.
You can also rest easy knowing that you are protected when you choose to work with us. In the past, equity release has had a negative stigma, but we have put safeguards in place to ensure that our later life customers are protected.
We are members of the Equity Release Council, which has product standards that provide additional consumer protection.
Another advantage of our equity release plan is that it can be a lifeline for interest only mortgage prisoners.
Many applicants in the 1990s and early 2000s may have taken out an interest only mortgage, but now find themselves unable to remortgage or access other options due to changing affordability checks.
With our equity release plan, you can pay off the final capital balance and take out a new mortgage, releasing the equity that has grown over time.
With a lifetime mortgage, you do not need to worry about a separate repayment vehicle, as the sale of your home will repay the balance either when you have died or moved into long-term care.
Additionally, with our no negative equity guarantee, you will not owe more than what you borrowed, providing peace of mind for you and your estate.
As with any mortgage, there are also downsides to equity release in Manchester. One major negative aspect is that allowing the interest to roll-up can gradually reduce the equity in your property.
This means that when it comes time to sell your property, whether after your passing or moving into long-term care, there will be a higher balance to repay, leaving little or nothing for inheritance.
For many, leaving an inheritance is important, and this may be a deal-breaker for them. You may have the option to ring-fence a portion of your equity initially, although there may not be much left after this.
Moreover, as previously mentioned, it’s not always certain that you will pass away before your property is sold. You may need to move into long-term care, and if there is enough equity in your property and you have made interest payments, your care costs may be covered.
Unfortunately, if the interest has rolled-up and there are not enough funds from the property sale, it may not cover the costs of your required care.
Determining whether equity release in Manchester is the right option for you depends on your personal circumstances and goals. Unlike traditional mortgage lending, equity release can only be obtained through a later life mortgage broker in Manchester, after receiving equity release advice.
This is because while equity release can be a great option for some, it may not be suitable for everyone and can end up being a costly mistake. With the help of a later life mortgage advisor, your lifetime mortgage will be customised to your specific needs and plans.
Equity release in Manchester and lifetime mortgages are highly adaptable and can be tailored to meet your goals. Your mortgage advisor will also consider alternatives, such as conventional or unsecured lending, before discussing equity release as an option.
To determine which option, equity release or an alternative, is more suitable for you and your future plans, seeking expert equity release advice in Manchester from a qualified and professional later life mortgage advisor is recommended.
By examining your current situation, the advisor can provide the best possible guidance on how to proceed.
Taking out equity release advice in Manchester can help you avoid future pitfalls, as your later life mortgage advisor can plan around future decisions, such as ring-fencing inheritance, as previously discussed.
In addition, equity release advice in Manchester can be beneficial for younger borrowers. A later life mortgage advisor can examine holistic or phased entry into later life lending, and offer over 50’s mortgages.
These can include term interest only, retirement interest only, or other conventional mortgage options, for those who may not meet the age requirement for equity release in Manchester or are better suited for an alternative.
Your later life mortgage advisor prioritises your needs and will recommend the best option for achieving your goals while ensuring that you are secure and protected in the later stages of your life.
To understand the features and risks, ask for a personalised illustration.
A lifetime mortgage may impact the value of your estate and it could affect your entitlement to current and future means-tested benefits. The loan plus accrued interest will be repayable upon death or moving into long-term care.