Is it right for me?
It depends on your age and personal circumstances.
There are a few factors to consider before you take out a lifetime mortgage.
- It will reduce the amount you leave as an inheritance.
- With an interest roll-up mortgage, the total amount you owe can grow quickly. Eventually this might mean you owe more than the value of your home unless your mortgage has a no-negative-equity guarantee (Equity Release Council standard). Make sure your mortgage includes such a guarantee.
- A mortgage with variable interest rates might not be suitable because the interest rate might rise significantly. But this is capped for mortgages meeting the Equity Release Council standards.
- It might affect your tax position and entitlement to means-tested benefits. Lenders will expect you to keep your home in good condition within the framework of reasonable maintenance. You might need to set aside some money to do this.
If any of these might be a problem, an equity release scheme might not be suitable for you.
Raising income from your home is a big decision and might not be your right or only solution. It’s important to discuss it with your family so they understand how it works and how it may affect them.
It’s also essential to get professional financial advice to ensure that it would be right for you, meets your needs and to explore other options that may be available.
As One Stop Finance does not hold the appropriate license for Equity Release mortgages we tap into our affiliate company, Lifetime Mortgages, to offer a referral to a known party who have years of experience which enables them to provide the right advice for our clients.