How much can I release?
This will vary depending on your individual circumstances, your age, the value of your property and which type of equity release plan you apply for. Your equity release adviser will be able to give you a personalised illustration and talk you through the plan types available.
What is the interest rate?
The rate you pay will depend on the rate at the time you take the plan. Our lifetime mortgages are likely to have a higher interest rate than a standard mortgage because it is fixed for life, meaning that you have protection against any rate increase in the future. Also, you won’t make any payments until the plan ends - this is when you pass away or move into long-term care. Again, your equity release adviser will give you all the details.
Are there any fees?
Yes, these are briefly explained below. However your equity release adviser will be able to fully explain the costs involved and how they affect the plan.
This covers the cost of valuing your property, and is payable by cheque when you submit the application.
You can pay this up-front at application stage or it can be paid on completion and added to your loan.
Your solicitor's fees
You should agree these with a solicitor of your choice. Our legal fees are covered within the arrangement fee.
You may be charged a fee by your equity release adviser. This should be agreed at the outset.
Pure Retirement may contribute towards, or pay in total, some or all of the costs associated with the set-up of your equity release plan.
This is subject to our lending criteria, please speak to your equity release adviser for more information.
Do I need to involve my family when making a decision?
Whilst not a requirement, we do feel it is important to consider discussing your plans with your family.
Will this affect my tax position or my entitlement to certain state benefits?
The good news is that any cash released from your home is tax-free. However, it is important that you discuss these matters with your equity release adviser, as depending on your personal circumstances, it could affect both.
Do I still own my home?
Yes, and you can continue to live in it until you or your partner, in the case of a joint application, pass away or need to move into long-term care. You will need to ensure that you maintain the property in a good condition. It’s also your responsibility to insure your home and pay all your property-related bills, such as gas, electric and council tax.
Can I move?
Our lifetime mortgages are portable, which means that you will be able to move and take the plan with you if you so choose in the future. The new property would need to meet our lending criteria at the time and if it’s worth less than the current one you may need to pay back some of the loan and interest. There may also be additional legal and arrangement fees, as normally associated with moving house.
Can I end the plan early?
Our lifetime mortgages are designed to last for the rest of your life, however you are able to end the plan early by paying off the loan and the interest. There may be an early repayment charge for this. Your equity release adviser will be able to discuss this with you.
How does the rolling-up of interest work?
Our lifetime mortgages have no repayments due through the period of the loan. Instead, interest is added to the amount owed each month and repaid when the loan is redeemed. Interest is charged at a fixed rate, applicable at the time of application, calculated daily and added to the loan each month on a compound basis. To understand the effects of this please refer to your equity release adviser.
Can I borrow more if my property increases in value?
Additional borrowing may be available, subject to our lending criteria and interest rates at the time. Your property will also need a new valuation.
How is my lifetime mortgage paid off?
The loan will be repaid when your home is sold, usually following your death or your move into long-term care. In the case of joint-borrowers, this would be when the last surviving partner passes away or moves into long-term care.
When repayment is due, the full amount must be repaid. This amount will be made up of the original loan amount plus any accrued interest. It may also include charges that have been applied to the loan e.g. arrangement fee and advice fee and any further borrowing you have taken.
Any remaining equity in your home, after the loan has been repaid, will belong to you or your estate.
Can I leave inheritance?
By its very nature a lifetime mortgage will reduce the value you have in your home. Any money left in your property when it’s sold will belong to your estate. For more information about this, please seek specialist advice.
Who sells the house?
If you go into long-term care then either you or your solicitor will sell the house. If you pass away, then this will be sold by the person looking after your estate.
This is a lifetime mortgage. To understand the features and risks, ask for a personalised illustration.