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Equity release mortgages are an increasingly popular way to release some of the value in your home, without having to move or downsize. You may be looking to carry out some home improvements, assist your children financially, to travel or simply to pay for living expenses as you grow older. Whatever your reasons, our specialist equity release solicitors are here to help.
We have an experienced team able to advise you on the legal aspects of your equity release mortgage plans. A lifetime mortgage can allow you to get a tax free lump sum payment for the equity tied up in your home while allowing you to continue living in the property until you die or move in to long term residential care.
At Glanvilles, we understand that rising living costs and shrinking pension pots can make life challenging as you grow older, not to mention limiting you from doing the things you should have the freedom to do in your retirement, like travel or invest in your hobbies. As you grow even older, it is also likely you will need to pay for some level of care.
Nobody should ever be expected to sell their home and move out because they are struggling to support themselves or the people they love in their retirement. Equity release can help you avoid this possibility.
However, equity release is a major financial decision which could have wide-ranging implications for you and the people you want to provide for after you die. Therefore, you should always take careful legal, financial, and tax advice before deciding to go for it.
For practical advice about lifetime mortgages, get in touch with our equity release solicitors in Chichester, Fareham, Havant or Petworth, email us at [email protected] or fill in our simple online enquiry form for a quick response.
There are many important considerations to take into account before getting an equity release mortgage, including your eligibility, whether you already have mortgages on the property, the current value of your home, and the tax, benefits and other financial implications.
We always advise clients considering an equity release mortgage to obtain independent financial advice and tax advice, preferably from advisors specialising in these respective areas. Before deciding whether to proceed with an Equity Release Mortgage, it is important to consider whether an equity release mortgage is appropriate for you and whether the proposed scheme matches your objectives and protects your long term interests.
A lifetime mortgage is a popular form of equity release. It is a loan which is secured over your home just like an ordinary mortgage. Unlike an ordinary mortgage, you do not have to make payments and the interest is rolled up into the loan. You can continue living in the property which will only be sold once you have passed away or moved permanently into residential care. To obtain a lifetime mortgage you (or both of you if you are obtaining joint borrowing) will need to be at least 55 years old.
The money you receive from the equity release will be tax free and you would also continue to benefit from any rise in value of your property. We recommend that you speak with a tax advisor on the tax implications that may arise and a financial adviser to ensure that getting an equity release does not adversely affect your entitlement to any state benefits such as Pension Credit or Income Support.
If you choose to instruct us to help with your equity release, we will ask you if you already have a mortgage or secured loan on your property. You may still be eligible for an equity release mortgage if you do already have a mortgage or secured loan, but this will depend upon the current value of your home and the amount outstanding balance on your current mortgage.
If you do proceed with an equity release mortgage, you will be required to pay off any outstanding mortgages or loans secured on your home at the same time as the transaction completes. We can arrange to do this for you, including liaising with your mortgage lender on your behalf.
If you obtain a lifetime mortgage, you will continue to be responsible for the upkeep and maintenance of your property. The mortgage lender will make certain stipulations requiring you to keep your property to a certain level of repair and decoration. You will also be responsible for ensuring that you have building insurance in place.
Some Equity Release mortgages are transferrable to another property (subject to certain conditions and requirements of the lender being met) so it may be possible to move in the future should you wish to and if the mortgage lender is prepared to transfer the mortgage.
A major concern for many people considering equity release is the risk of their property going down in value. Since most people do not make payments towards the loan, it is easy for the amount outstanding to shoot well above the value of the property.
Thankfully, you can protect yourself against this risk. You should ensure that any equity release mortgage you consider has a negative equity guarantee. This guarantee means the amount borrowed plus the interest you owe on the loan will never exceed the sale price of the property. This will prevent any negative equity and consequent mortgage debt being passed onto the executors of your estate in the event of your death.
Please do let us know if you have dependants living with you as Equity Release may not be right for you. If your dependants wish to remain living with you at the property, it is likely that they will be asked to sign a waiver to confirm that they understand they do not have any rights to remain living at the property should you move into long term care or pass away. It is for this reason we would always recommend that any dependants obtain independent legal advice before signing any such waiver.
Equity Release does potentially reduce the value of your estate so we may advise you to speak with your loved ones and beneficiaries under your Will about your plans. Some equity release plans allow you to ringfence some inheritance for your loved ones which cannot be touched by the loan. However, it is always worth asking if your loved ones or beneficiaries may be able to assist you financially or lend you money on terms which could be preferable to corporate lenders before choosing equity release.
We have an experienced Wills and Probate team who would be happy to assist you if you require any further advice in this regard.
At Glanvilles, we pride ourselves on our warm, welcoming customer service which we combine with our specialist legal knowledge and practical experience.
Our firm are members of the Law Society Lexcel Accreditation Scheme, which is only achieved by law firms which display the highest standards of customer care and legal practice management. This means you can trust us to handle your equity release carefully and efficiently, providing excellent value for money no matter how complex your case.
We are also members of the Law Society Conveyancing Quality Scheme Accreditation which is only maintained by firms which excel in residential property services. We will handle all legal aspects of your equity release transaction with meticulous attention to detail.
We are also members of Solicitors for the Elderly (SFE), a specialist group of lawyers with particular expertise supporting and providing advice to older and vulnerable people.
Glanvilles is independently regulated by the Solicitors Regulation Authority (SRA).
If you would like further advice about equity release or would like to talk to us about the costs involved in an equity release mortgage transaction, please do not hesitate to contact one of our offices in Chichester, Fareham, Havant or Petworth. Our approachable understanding and expert team would be very happy to help.