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Equity Release
Below is a brief summary of the main types of equity release products available. For full information about the all the types of equity release, (including equity release lifetime mortgage products and advice – please visit our dedicated Ascot Equity Release pages. PLEASE NOTE – Ascot Mortgages do not give advice on home reversion plans.
Lifetime Mortgages
Through this equity release lifetime mortgage product you will receive an amount of money to spend on whatever you want. You continue to own your home and can live there until death or until you go into long-term care.
Under the terms of this lifetime mortgage product, you do not have to make any monthly payments during the lifetime of the loan, the loan and accumulated interest are repaid following the sale of your property at the end of the plan. The end of the plan is normally when you die or move into long-term care. There are also some lifetime mortgage options that will allow you to make serviced monthly interest payments.
Moving home is still an option available to you as long as your new home meets our lending conditions at the time.
We would encourage you to discuss any potential decision regarding equity release products with your family; they are also welcome to attend any appointments you make with our Advisors to discuss lifetime mortgage products.
Considerations:
Interest on lifetime mortgages is charged on the total amount of the loan including any interest that has already been accumulated; therefore the amount borrowed will increase throughout the duration of the lifetime mortgage unless full monthly interest payments are made.
If you currently have a small existing mortgage on your home you will need to use any money raised through the equity release lifetime mortgage product to pay off the existing mortgage first, you are then free to spend the remaining money as you wish.
The cash lump sum is tax-free, however, it could affect your tax position and means tested benefit entitlement. Lifetime mortgages are long-term commitments, if you choose to repay the loan early it could be expensive and you may be required to pay a substantial early repayment charge with these types of products.
This is a lifetime mortgage. To understand the features and risks ask for a personal illustration.
Home Reversion Plans
A Home Reversion Plan allows you to release an amount of money by selling all or part of your home to the reversion provider. PLEASE NOTE – Ascot Mortgages do not give advice on these types of plans.
Benefits to you include:
The receipt of a cash lump sum from the equity release to spend on whatever you want.
The benefit of living in your home rent free until you die or go into long-term care.
The flexibility of still being able to move home if you want to as a Home Reversion Plan is portable, as long as your new home meets eligibility criteria at the time.
If you sell less than 100% you may be able to afford your family an inheritance from the sale of the property.
We would encourage you to discuss any potential decision regarding equity release home reversion products with your family; and a home reversion specialist as Ascot Mortgages do not advise on these types of plans.
Considerations:
Due to money derived from Home Reversion Plans being provided upfront and you continuing to live in your home rent free, you’ll get less than the full market value of the share of the property.
The legal title of your property through the equity release scheme will be transferred to the home reversion provider although you will remain living in your home. By selling all or part of your home along with the costs involved, the value you have in your property will reduce along with the amount of any inheritance you will be able to leave.
If you currently have a small existing mortgage on your home you will need to use any money raised through the home reversion product to pay off the existing mortgage first, you are then free to spend the remaining money as you wish. The cash lump sum is tax free, however it could affect your tax position and means tested benefit entitlement.
When the plan ends the home reversion provider will sell your property and will receive any proceeds. They will take their share of the sale price and pay any balance remaining to you or your estate in the event that you only did a partial home reversion plan. Home Reversion Plans are long term commitments, buying back the share of your property in the future could prove expensive as you will have to pay the full market value.
