When bills have spiralled out of control, could tapping into the equity in your home provide a solution? Equity release expert Mark Gregory explains more in our latest Q&A
The Question
My partner recently died and without his income I am struggling to pay the bills. As I am aged 59, will equity release be an option?
I’d like to know whether living alone will impact my eligibility. I work full time and earn £34,000. I hope to go part-time eventually. I am currently paying the mortgage on my own and have started dipping into savings so my only other option, if I can’t use equity release, is to sell up.
There is £90k left on the mortgage and our property is worth £460,000. I hope you have some good news for me!
Mark’s Answer
Hello, and firstly may I say how I am very sorry to read about the loss of your partner and your struggles to manage your finances. Although you have not provided me with any details regarding the construction type of your home, based on its value and your age, there may be a flexible option available to you and I believe this may be the good news you are looking for.
I can confirm that you may be eligible for a flexible lifetime mortgage that you could use to replace your existing mortgage and give you the financial freedom you require. This is because with a flexible lifetime mortgage you retain 100% ownership of your home for the rest of your life or until you need long-term residential care.
The flexible Lifetime mortgage allows you to access a tax-free lump sum with a fixed interest rate for life and then you decide to make payments to service the loan and retain a capital balance, make partial payments to service some of the interest, or make no payments at all, and let the loan increase over your lifetime.
In the current market, based on your requirements, £90,000 is achievable via a lifetime mortgage with rates starting at 6.16% MER with Pure Retirement’s Classic Plan. With all lifetime mortgages, you have the option of making flexible voluntary payments of up to 10% of the amount borrowed each year with no penalty. Therefore, dependent on your budget and how much you wish to leave your beneficiaries, you can decide on whether payments are something you wish to pursue.
Therefore, to decide the best option for you and to ensure your home is eligible for a flexible Lifetime mortgage, I would suggest you take advice from one of our friendly expert advisers without any obligation or any initial charge.
They can provide you with a key-facts illustration to show you all of the features, risks and benefits without obligation, and they will consider the whole of the market. They will discuss all of your options and then you will be able to make an informed decision that will help you decide which option suits your personal circumstances.
Meet our expert…
Mark Gregory, founder and CEO of Equity Release Supermarket, is here to answer your questions. Mark is an adviser himself with over 20 years equity release experience.
He launched Equity Release Supermarket 10 years ago and it has grown to become one of the UK’s leading equity release specialists.
Email kate.saines@emap.com to ask Mark a question
