Equity Release in Sunderland

Equity Release In Sunderland | March 2024

A financial option called equity release in Sunderland enables homeowners, especially older ones, to access their property’s value while residing there. 

To complete this process, you must either obtain a loan (a lifetime mortgage) secured by your house or sell all or a portion of it (a home reversion plan). 

Table of Contents

Understanding Equity Release

The two main categories of equity release products are lifetime mortgages and home reversion plans. A lifetime mortgage is a loan secured by your house and allows you to withdraw tax-free money from the market value of your home. 

The loan balance and interest are paid back when the homeowner dies or enters long-term care. To prevent negative equity, the equity release provider guarantees that you will never owe more than the value of your home. 

On the other hand, home reversion plans entail selling all or a portion of your home to a reversion company in exchange for a tax-free lump sum or ongoing payments. 

Depending on the terms of the agreement, you can live in your home rent-free for the rest of your life but may not own it all. Homeowners can access their home’s equity while still residing there thanks to equity release programmes like lifetime mortgages and home reversion plans. 

For those who need additional funds for retirement or to pay off an existing mortgage, this may offer a solution, but it’s crucial to get financial advice before moving forward.

Equity Release Benefits

Accessing tax-free cash without relocating or downsizing is one of the main advantages of equity release. You can get this as a one-time or recurring payment, giving you a steady income for expenses in your later years. 

Another advantage is that most lifetime mortgages guarantee that there will never be negative equity, meaning that the debt will never exceed the home’s market value. 

This gives borrowers peace of mind because they know that their loved ones won’t inherit a debt that is more substantial than the value of their home. A lifetime mortgage also typically does not require monthly payments because the loan and interest are paid off when the house is sold. 

However, some plans allow the homeowner to make monthly payments if they so choose. 

Finally, equity release’s adaptability lets you use the money that has been released however you like. 

You can use the money for home improvements, supporting loved ones, or just raising your standard of living in retirement.

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.

Risks of Equity Release

Although equity release can increase retirement income financially, there are risks involved. A sizable financial commitment might impact your tax situation and ability to receive means-tested benefits. 

Therefore, getting professional equity release advice is imperative before making a choice. The potential for rolled-up interest is one of the main risks. A lifetime mortgage adds the claim to the loan, and you are not required to make monthly payments. 

This can gradually raise your debt level, decreasing the inheritance you can leave behind. If you repay the loan earlier than expected, early repayment fees might also be assessed. Consider these charges because they can be significant when preparing for your financial future.

A change in circumstances is an additional risk. If you need to enter long-term care, the home might need to be sold to pay off the loan. You might require the lender’s approval to move into a smaller house, like downsizing.

Last but not least, even though the no negative equity guarantee guarantees that you won’t owe more on your mortgage than it is worth, it also means that you might have less to leave as an inheritance. 

Involving your family in your decision-making is crucial because it may impact them.

Equity Release in Sunderland

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.

Types of Equity Release Plans 

Understanding the various available equity release plans is crucial when thinking about equity release. Lifetime mortgages and home reversion plans are the two main categories, and each has advantages and features.

Most equity releases take the form of lifetime mortgages. This entails taking out a loan secured by your home and paying it back when you pass away or enter long-term care. 

The homeowner retains complete home ownership, and most lifetime mortgages include a guarantee against negative equity.

Lifetime mortgages come in various forms, such as interest-only plans, where you pay the interest only every month and drawdown plans, where you can gradually release funds as and when you need them.

On the other hand, home reversion plans entail selling all or a portion of your home to a provider in exchange for a one-time or ongoing payment. 

You can stay in the home rent-free until you pass away, but you won’t own it outright or only have partial ownership due to the reversion company.

Legal Aspects in Sunderland

Understanding the legal ramifications is crucial when thinking about equity release in Sunderland. The Financial Conduct Authority (FCA) oversees the equity release market and ensures all service providers follow stringent ethical guidelines.

Get independent legal counsel before signing an equity release agreement. You can get assistance from solicitors in understanding the terms and conditions of the plan, including both party’s rights and obligations. 

Additionally, they can offer advice regarding potential tax implications and state benefit eligibility related to the project. Homeowners in Sunderland thinking about releasing equity must speak with an FCA-registered financial advisor. 

This guarantees that you will get unbiased guidance specific to your needs. To assist you in making an informed choice, the adviser should review all of your options, including any potential alternatives to equity release.

Choosing an Equity Release Provider

A pivotal choice to make is which equity release provider to use. Choosing a provider who is an Equity Release Council member is advised because they must follow a strict code of conduct, which includes offering a no negative equity guarantee.

When selecting a provider, consider the interest rates and whether the rate is fixed or variable. Consider the plan’s flexibility, such as making partial repayments or accessing additional funds as necessary.

The provider’s reputation and customer service should also be considered. Look up reviews and solicit referrals. An excellent service provider will be open and honest about all costs and fees, including any early repayment penalties or consultation fees.

Finally, think about consulting a specialised equity release adviser. They can walk you through the process while assisting you in making plan and provider comparisons.

Impact on Benefits and Taxes

Your tax situation and eligibility for means-tested benefits may be impacted by equity release. The tax-free money you withdraw from your house may affect your eligibility for benefits like pension credits or council tax exemptions.

It’s also crucial to remember that even though the lump sum you get from an equity release plan is tax-free, there may still be taxable consequences. For instance, investing and receiving interest may be taxed. 

Similarly, using the money to purchase a different property might increase your inheritance tax burden. Speaking with a financial advisor who can offer individualised advice based on your unique circumstances before moving forward with equity release is advisable.

Alternatives to Equity Release

Equity release is not the only option available, though it can be a valuable source of income in retirement. Depending on your situation, other options might be preferable.

Although moving to a smaller home will cost money and may not be feasible depending on your health and way of life, downsizing can free up money.

Another choice would be to rent a room or take in a lodger, providing a steady income stream. This, however, will have tax repercussions and might only be appropriate for some.

Although it might cause family tension, consider borrowing money from your family. Alternatively, you might be eligible for state grants or benefits you aren’t currently claiming.

It’s crucial to get unbiased financial advice before making any decisions. You can choose the best course of action for your circumstances by working with an adviser to fully understand your options, including equity release.

Equity Release Advice and Costs

It’s crucial to get equity release advice when thinking about equity release. A financial advisor can explain equity release in detail, including its operation, potential risks and rewards, and how it might affect your future financial planning. 

They can also advise you on the different equity release products that are offered and assist you in choosing the one that best suits your requirements.

Costs associated with equity release products must be taken into account. These include the loan’s interest rate, which impacts your overall debt over time. While some plans have variable interest rates, others have fixed interest rates. 

If you repay the loan earlier than planned, you incur early repayment fees, advice, and legal fees. All of these expenses must be considered when considering equity release.

Equity Release Impact on Property and Inheritance

Your property and inheritance may be impacted by equity release. A lifetime mortgage is a loan secured by your home, so when your parcel is sold, the amount you owe will be subtracted from the sale proceeds. Your loved ones will inherit less money as a result.

If you have one, the equity release will first be used to pay off your mortgage. The remaining funds are then yours to do as you please.

Equity release could also impact your ability to leave your property to your family as an inheritance. This is because the loan and any accrued interest must be paid back upon your passing or if you enter long-term care.

Equity Release Calculator and Sunderland Market Value

When considering equity release in Sunderland, a calculator is helpful. Based on your home’s age and market value, you can calculate the amount of equity you could release from it. 

However, the criteria set forth by the equity release provider will determine how much you can borrow. The amount of money you can release will be significantly influenced by the market value of your Sunderland property. 

You can release more equity if the value of your home rises over time. The money you can access might be restricted if the property value decreases.

Remember that equity release involves a sizable financial commitment and should be regarded with seriousness. Before making a choice, it’s crucial to seek advice from a qualified advisor and weigh all your options.

About Sunderland

Tyne and Wear’s vibrant city of Sunderland is situated in the North East of England. Sunderland, which is renowned for having a rich history and cultural heritage, has a diverse population and offers a wide range of attractions.

The SR series includes the main postcode areas for the city, which are SR1, SR2, SR3, SR4, SR5, and SR6. Sunderland’s telephone area code, 0191, connects its residents to the rest of the United Kingdom.

Sunderland’s most notable features are awarded public parks and a stunning coastline. The Sunderland International Airshow, one of the biggest airshows in Europe, is another of its well-known attractions. 

The University of Sunderland, which draws students from all over the world, is another noteworthy aspect of Sunderland. The university contributes significantly to the city’s lively and multicultural atmosphere.

In addition, Sunderland has a long history of industry, particularly coal mining and shipbuilding. Despite declining, these industries still impact the city’s museums and cultural attractions.

Local Areas Where Equity Release Can Be Provided

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

1) Ashbrooke

2) Ayres Quay

3) Barnes

4) Bishopwearmouth

5) Carley Hill

6) Castletown

7) Claxheugh

8) Deptford

9) Doxford Park

10) Farringdon

11) Ford Estate

12) Fulwell

13) Gilley Law

14) Grangetown

15) Grindon

16) Hendon

17) Herrington

18) Humbledon

19) Hylton Castle

20) Hylton Red House

21) Marley Pots

22) Millfield

23) Monkwearmouth

24) Moorside

25) Nookside

26) North Hylton

27) Pallion

28) Pennywell

29) Roker

30) Ryhope

31) Seaburn

32) Sheepfolds

33) Shiney Row

34) Silksworth

35) South Hylton

36) Southwick

37) Springwell Village

38) Sunnyside

39) Thorney Close

40) Tunstall

41) Witherwack

42) Washington

43) Seaham

44) Houghton-le-Spring

45) Hetton-le-Hole

46) Birtley

47) Chester-le-Street

48) Jarrow

49) Gateshead

50) Whitley Bay

51) Peterlee

52) Wallsend

53) Newcastle upon Tyne

54) Hebburn

55) Felling

56) North Shields

57) Tynemouth.

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.

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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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