Talk With Your Financial Planner Before Planning for Equity Release

Are you considering equity release? This is a difficult decision to make, and one that shouldn’t be taken lightly. Before making any decisions about this type of loan, it should be discussed with your financial planner. Here are 10 reasons why you should speak with your financial adviser before planning for equity release:

-Your home will have to be sold or given away if the lender can’t sell it after it’s been repossessed

-You could lose your pension altogether if the provider cancels the plan because they are not satisfied with how much money has been repaid out of their contributions

-If you’re aged 55+, there will be an income tax charge on any funds released from collateral under age 60+

-You will not be able to access these funds until you are at least age 55

-There is no protection on interest rates for equity release loans, so the rate could go up when your property value goes down. If this happens and there’s nothing left in the loan that can repay it, then you’ll have a high risk of losing your home

-If either partner dies before the other one has repaid all the money owed under an equity release plan, their estate may still inherit some or all of any remaining debt

-Your spouse/partner will lose any rights they had over your house if you use a lifetime mortgage option during repayment as opposed to using another option such as buying out their share with cash paid directly to them

-If you take out an equity release loan, it’s your responsibility to repay the debt and not your spouse/partner. However, if you die before repaying the full amount of money owed under this type of loan, then they’ll still gain rights over part or all of what remains in your property after repayment