This article was last updated on 1 September 2021.
Retiring from your job can be very stressful especially if you have not figured out how you will support your expenses.
Equity release is a favourable option for many people as it provides a reasonable financial boost. However, getting a loan against your property will always evoke questions of what will happen when you die. Additionally, it’s important to know what your loved ones need to do after you die.
Equity release gives you the option to borrow money from your property and still maintain 100% ownership of the property.
You can read more about how equity release works here. Alternatively, here is a short video.
After the last owner of the property dies or moves to a nursing home, the beneficiaries must inform the equity release providers.
They need to show them the death certificate, and other related documents, as this is to ensure that the lenders know that they now need to deal with you with regards to repayment of the equity release mortgage.
The equity release plan typically needs to be paid within a 12 month window period. Some estates decide to put the house on sale to get the money to pay the provider. Others opt to put the house up for rent as this ensures that the provider gets a certain amount at the end of the month. However, if you are looking to sell the house then having tenants could cause some challenges.
A point to note is that the interest keeps on the building during those 12 months. If the money can’t be repaid within the 12 months, the provider talks it through with the beneficiary to come up with a new plan to be able to pay the money. Ultimately the provider is able to repossess the house if the money is not paid back.
If you had applied for joint plans when taking up an equity release plan, then your spouse will continue living in the house until they die or move to a nursing home.
When taking out the equity release, you should ensure that you indicate on your documents that you want a joint plan. If not, your spouse might be forced out of the house at an earlier stage than you may have anticipated. This can be very devastating to them to be forced out of their home and can in some circumstances lead to depression.
To ensure that your spouse is taken care of even when you are not alive, we would suggest that you do look in to the benefits of having a joint plan.
Depending on the complexity of the affairs of the person that died, there may be a need to apply for probate. In this circumstance you will probably need to engage with a probate specialist or solicitor.
In the case of a joint plan, and one spouse dies, the other partner in the agreement will continue taking responsibility for the equity release (assuming they are receiving regular payments) until they die or move to a nursing home.
You might also choose to involve the solicitor once both the partners have died.
You can also choose to get advice from a financial advisor.
A financial advisor can help you come up with a plan on how to pay the lenders money back. They can also help you find out of some benefits that can help you out with additional income to help you pay the providers money.
Most people opt for equity release as a way to sustain their livelihood.
Equity release can be very helpful if you have no other source of income. However, they do impact your inheritance after you die, as quite simply you wont have a house to pass on. This means that your family don’t get to inherit your home, which is something neither you nor the family may want.
We work with with Key equity release for them to bring you their market leading equity release support. Through a free consultation they can help you decide what the best options could be for you.
If you would like some help, please leave your details below and someone will be in touch.
Or you can call Key directly on 0800 953 3792
In this article, we answer 22 important questions that you may have about equity release, including what it is, how it works and what the best interest rate deals are.
Equity Release is not for everyone. In this article we look at the alternative options that you can consider if you need access to money in later life to pay for care, top up your pension etc.
A lifetime mortgage is the most popular type of equity release scheme, as it’s the most flexible and versatile option. The amount you receive depends on your property value.
In recent years equity release has become a very popular option. This article looks at the pros and pitfalls of equity release and what you need to consider before taking it out.
How much you can borrow from equity release varies depending on your age and house value. In this article we look at how much you could borrow from your home.
A drawdown mortgage is a type of equity release scheme, offering greater flexibility and freedom compared with traditional plans. In this article we explain all that you need to know.
An equity release calculator will give you a good indication of what you can borrow from your home. This article explains how the calculator works and also shows you what you can receive.
One of the big concerns that people have about equity release is what happens to their home and borrowings when they die. In this article we explain everything you need to know.
A home reversion plan is primarily suited to individuals over 65 looking for a solution to their finances. This article explains all you need to know.
With reductions in interest rates there are some really good equity release deals available. The cheapest that we have seen in over 10 years! Contact us for free, in conjunction with Key Advice, to see what you could get.
You can speak to us on the number below and see what today's deals are or just have your questions answered.
0333 567 1607
Use our equity release calculator and see how much money you could receive.
You can book an appointment for a specialist to call you when it's conveniant for you
All equity release advice is provided in conjunction with Key Partnerships.
Choose how you want to engage with Key below