Equity Release in Shrewsbury

Equity Release In Shrewsbury | March 2024

Homeowners in Shrewsbury have access to the value of their properties through equity release. It is a financial scheme that enables you to access your home’s equity while you stay there. 

This article aims to explain equity release, including its types, eligibility requirements, benefits, and drawbacks.

Table of Contents

Understanding Equity Release

The process of releasing equity from your home while you remain a resident is called equity release. It’s a specific kind of equity release product that enables you to borrow money using the equity in your house as collateral. 

Depending on your equity release plan, the loan secured by the property may be repaid in a single lump sum or through ongoing payments. There are various equity release products, with lifetime mortgages being the most popular. 

This entails taking out a fixed-interest loan against a portion of the value of your house. Most lifetime mortgages don’t require monthly payments, in contrast to conventional mortgages. The loan and rolled-up interest are paid back when the property is sold.

A home reversion plan is an additional equity release product. This entails giving a home reversion company a portion or all of your residential property in exchange for a one-time or ongoing payment. 

Until you pass away or enter long-term care, you can stay in the home without paying any rent.

Unlike an existing mortgage, an equity release mortgage does not require monthly payments. 

However, getting guidance on equity release from a financial adviser before moving forward is imperative. An equity release advisor can offer professional advice outlining the potential cost of equity releases and their effects on your tax situation and means-tested benefits.

Types of Equity Release Schemes

Lifetime mortgages and home reversion plans are the two main categories of equity release plans. A lifetime mortgage is a loan secured by your house and can be taken out in one lump sum or over time. 

Due to its negative equity guarantee, it is a well-liked equity release plan. This guarantees that your debt will never exceed the value of your property. On the other hand, home reversion plans entail selling all or a portion of your house to a business. 

You can keep residing in your property without paying rent after receiving a cash lump sum or recurring payments. However, the business will get its sale price cut when the asset is sold. Your equity release option will largely depend on your needs and situation. 

You can calculate how much equity you can release from your home using an equity release calculator. Financial advisers like Masons Independent Financial Advisers can provide unbiased guidance customised to your needs.

You can also watch this video on Youtube here.

Try Age Partnership’s equity release calculator and estimate how much money you could release from your property.

If you take out a product from Age Partnership, we will receive a fee for introducing you to them. This helps support the site and for us to produce more content.

Eligibility for Equity Release in Shrewsbury

You must meet several requirements to be eligible for equity release in Shrewsbury. A lifetime mortgage requires a minimum age of 55, while a home reversion plan requires a minimum age of 65. It would be best to have a home in the UK, preferably your primary residence. 

The house must be in good shape and cost a certain amount, usually more than £70,000. Additionally, there should be little to no current mortgage on the property. 

Suppose you are taking out an equity release product. In that case, you must simultaneously pay off any outstanding loans secured by your home, either with the initial lump sum or other personal funds.

Additionally, some equity release companies demand a solid credit history. Speaking with an equity release advisor for qualified advice tailored to your needs is crucial.

Equity Release in Shrewsbury

Best Equity Release Interest Rates as of 24 February 2024

The table below shows you some of the best equity release rates, as of 24 February 2024, for lifetime mortgages from some of the leading equity release providers in the UK. 

Provider NameProduct NameInterest RateType of productOffers
Standard LifeHorizon 200 Drawdown5.26%FixedFree Valuation
Standard LifeHorizon 200 Drawdown Fee Free5.31%FixedFree Valuation
No application fee
More2LifeCapital Choice Ultra Lite Drawdown 15.46%FixedFree Valuation
No application fee
LV=Drawdown Lifestyle DD15.58%FixedFree Valuation
No application fee
Scottish WidowsFR15.60%FixedCashback
Free Valuation
No application fee
Standard LifeHorizon 280 Drawdown5.60%FixedFree Valuation
Legal & GeneralInterest Roll-Up 15.61%FixedFree Valuation
Legal & GeneralOptional Payment 15.61%FixedFree Valuation
LV=Drawdown Lifestyle DD25.63%FixedFree Valuation
No application fee
Legal & GeneralInterest Roll-Up 1 (no fee)5.65%FixedFree Valuation
No application fee

The equity release rates have been sourced by UK Care Guide from the Equity Release Supermarket website. These rates may have changed since this table was created and should be taken as indicative only. There may be other providers not listed on this table that could offer better deals.  In addition, the providers and products noted may not be right for your particular circumstances.  Therefore, they should only be taken as a guide, and we cannot guarantee their current accuracy. Please also note that we do not provide advice on or endorse any particular product listed here. The rate you are offered will depend on your individual circumstances and subject to lender approval. Therefore, we strongly recommend that you speak to an equity release adviser, who will be able to provide you with information on the latest rates that apply to you.

Speak To An Equity Release Specialist Today

Call Boon Brokers on 0333 567 1607 to discuss your equity release requirements and see what deals are available to you.

Pros and Cons of Equity Release

Equity release has several advantages. It offers tax-free funds that can be applied to any need, such as making home improvements, assisting loved ones in stepping onto the real estate ladder or boosting retirement income. 

It also guarantees that you can access its equity while remaining at home. It does, however, have some drawbacks. A significant financial commitment or equity release may affect your tax situation and eligibility for state benefits. 

Additionally, it might have high early repayment fees that would take money away from your heirs. You can better understand these implications if you seek independent legal counsel.

The Equity Release Process

There are several steps in the equity release process. First, consulting a financial adviser is crucial if you decide equity release suits you. They will go over your options and explain the effects of taking out home equity.

The next step is to select an equity release plan from a reputable provider, like a member of the equity release council. They guarantee that you will never have negative equity, which means that you will never owe more than the value of your home.

After that, you must retain a lawyer to handle the equity release agreement’s legal requirements. They will communicate with the provider’s attorneys, review the offer, and ensure you know the contract terms before signing.

Finally, depending on your chosen plan, the money will either be released in a lump sum or through ongoing payments.

Regulating Bodies and Safeguards

The Financial Conduct Authority regulates equity release products, ensuring suppliers adhere to strict guidelines for fairness and transparency. Providers frequently belong to the Equity Release Council, an organisation with strict requirements for its members to protect consumers. 

An important safety measure in equity release is the “no negative equity guarantee.” This guarantees that no matter how much interest accrues, neither you nor your estate will ever owe more than the value of your home.

Financial Advice on Equity Release

Getting independent financial advice from an equity release adviser is essential before signing up for an equity release plan. They can assist you in comprehending equity release’s benefits, expenses, and risks and how they may affect your tax situation and eligibility for state benefits. 

Keep in mind that not everyone should use equity release. You can explore options with the aid of a financial advisor, such as downsizing to a smaller home or utilising savings and other investments.

Alternatives to Equity Release

While equity release can boost your finances significantly, it’s not your only choice. Other options include downsizing to a smaller home, getting a personal loan or a traditional mortgage, or renting out a portion of your house. 

Investigate government programmes for homeowners or ask families for assistance. Your circumstances, financial situation, and long-term goals will all influence which option is best for you. So, getting expert guidance from a financial adviser or mortgage broker is essential.

Assessing Equity Release Lenders

There are many equity release companies in Shrewsbury, and they all provide different products and services. 

It’s critical to consider an equity release provider’s registration with the Financial Conduct Authority (FCA) and membership in the Equity Release Council when making your decision. 

This will guarantee that they uphold the guarantee of no negative equity and other safety measures.

The interest rates and early repayment penalties charged by various equity release lenders also vary. It can be helpful to compare lenders and products using an equity release mortgage calculator. You can do this online or with the assistance of a free financial advisor.

Remember to consider the equity release lender’s customer service. You need a business that will help you every step of the way, from the initial consultation to the actual money release.

Seeking Professional Equity Release Advice

Before signing an equity release agreement, it is crucial to get professional advice. A trustworthy equity release advisor, like Masons Independent Financial Advisers, can offer unbiased financial guidance specific to your needs. 

If you have financial obligations that you struggle with, they also offer debt advice. You can also get assistance from an impartial legal counsel in understanding the legal ramifications of an equity release plan. 

They can review the contract and the terms and ensure you’re making an educated choice. These solicitors are governed by the Solicitors Regulation Authority, which ensures their professionalism and competence.

Utilising Released Equity

You can use the money you release from your house in several ways, and it is tax-free. Some homeowners reduce their monthly payments and financial stress by using the lump sum to pay off an existing mortgage or other debts. 

A new or commercial property might attract investments from others, potentially generating an income stream or capital growth.

The released equity may also finance necessary home improvements or as a retirement income supplement. Some people might give a portion away to loved ones, assisting them in getting on the housing ladder or helping with college expenses.

Remember, before choosing how to use the released funds, it’s essential to consider your tax situation. The lump sum is tax-free, but there may be tax consequences if invested or given as a gift. Before making any decisions, always seek tax advice.

After Equity Release Completion

After completing the equity release procedure, there are essential things to remember. First, remember that the lender may inspect your property to ensure its condition. The loan could be repaid early if the property needs to be maintained correctly.

You must first notify the lender to add someone to the equity release agreement, such as a new spouse. The contract terms typically need to be revised to accommodate a new borrower.

Remember that equity release may limit your ability to receive means-tested state benefits. To learn how your benefits might be impacted, it’s advised that you consult StepChange Financial Solutions or other financial advisors.

About Shrewsbury

Shrewsbury is a traditional market town in the English county of Shropshire. It is located on the River Severn in the country’s West Midlands region. Shrewsbury is renowned for its red sandstone castle and well-preserved timber-framed buildings. 

It has a long history that dates back to the Middle Ages. The telephone area code 01743 designates the town. It includes several postcodes, primarily SY1, SY2, and SY3. 

These areas encompass various city areas, such as Belle Vue, Sutton Farm, and Shrewsbury Town Centre. Shrewsbury is renowned for its horticultural beauty and annually hosts the Shrewsbury Flower Show, one of its most critical national gatherings.

In addition, the town is home to the Quarry, a picturesque parkland that provides peaceful riverside strolls. It’s interesting to note that the renowned naturalist Charles Darwin had a connection to Shrewsbury. 

He was raised at Shrewsbury School after being born in 1809. Numerous landmarks in the city, such as the Darwin Shopping Centre and the Quantum Leap sculpture, honour this connection.

Areas Where Equity Release Can Be Provided

Here is a list of local areas and boroughs where equity release services can be provided.

  1. Abbey Foregate
  2. Belle Vue
  3. Castlefields
  4. Coton Hill
  5. Ditherington
  6. Frankwell
  7. Greenfields
  8. Kingsland
  9. Monkmoor
  10. Mount Pleasant
  11. Radbrook
  12. Springfield
  13. Sundorne
  14. Underdale
  15. Wyle Cop

And here is a list of towns, villages, and boroughs within 10 miles of Shrewsbury.

  1. Atcham
  2. Bayston Hill
  3. Bicton
  4. Bomere Heath
  5. Condover
  6. Cressage
  7. Cross Houses
  8. Dorrington
  9. Ford
  10. Hanwood
  11. Harlescott
  12. High Ercall
  13. Montford Bridge
  14. Much Wenlock
  15. Pontesbury
  16. Shawbury
  17. Telford
  18. Uffington
  19. Wellington
  20. Wroxeter.

Try Age Partnership’s equity release calculator and estimate how much money you could release from your property

Financial Promotions Sign-off

Where applicable, the adverts for Boon Brokers on this page have been signed off as a Financial Promotion by Boon Brokers Limited, to ensure that they are in compliance with Section 21 of FSMA. Boon Brokers Limited is authorised and regulated by the Financial Conduct Authority (FCA). The Financial Services Register number is 973757.

The Age Partnership equity release calculator has been approved and provided by Age Partnership. Age Partnership is a trading name of Age Partnership Limited, which is authorised and regulated by the Financial Conduct Authority. FCA registered number 425432.

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Meet the author

Jane Parkinson

Jane Parkinson

Jane is one of our primary content writers and specialises in elder care. She has a degree in English language and literature from Manchester University and has been writing and reviewing products for a number of years.

Meet The Team

Most advisors charge for their service.  But you can get fee-free equity release advice from Boon Brokers. 

Call : 0333 567 1812

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If you take out a product from Boon Brokers, we will receive a fee for introducing you to them.

Unlike most equity release advisors, Boon Brokers do not charge any fees! Have a free consultation to see how they can help.

You can speak to Boon Brokers on the number below and discuss your options.

0333 567 1812

Use the equity release calculator and see how much money you could receive.

You can book a callback from an equity release specialist, who can call you when it's conveniant.

All equity release advice is provided by Boon Brokers Limited, which is authorised and regulated by the Financial Conduct Authority (FCA). The Financial Services Register number is 973757. 

 

If you take out a product with Boon Brokers, we will receive a fee for introducing you to them. Boon Brokers provides advice for free and without obligation.  By contacting Boon Brokers through us, the cost of any equity release product would be the same as if you had contacted them directly.  

The fee we receive is used to help keep this site operational and to produce new content.  

 

Think carefully before securing other debts against your home. Your home or property may be repossessed if you do not keep up repayments on your mortgage.

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