As Equity Release Schemes continue to grow in popularity, the need for full and comprehensive advice has never been so important.
Whilst many people see these schemes as a method of releasing a one-off lump sum, they can also be used to supplement income. Indeed, because of how these schemes work, by rolling up interest, a good adviser is likely to suggest that only a small amount is released from the scheme initially with access to further funds (releases) being made available as and when needed. This slows down the roll up of interest and helps to preserve the equity in your home.
Whilst advisers stress that further advances are subject to certain terms & conditions, they often overlook the fact that if the borrower loses mental capacity, they may not be able to release further money from the scheme because they would be deemed incapable of making such a decision.
It is therefore important to seek advice not just from an Equity Release Adviser but also one that will look at the wider issues and consider much more than just the scheme itself. For example, in order to avoid the problem of being unable to access further funds, clients should also consider putting a Lasting Power of Attorney (LPA) into place. In the event that the client loses capacity, the Attorney can then take over and make decisions on the client’s behalf. There are two types of LPA: Property & Affairs and Health & Welfare. A client should consider putting both into place as each is used in different scenarios.
Equity Release specialists – i.e. companies only focused on arranging an Equity Release Scheme, may not give wider advice and guidance on such issues.
When looking to appoint an adviser, the cost of advice will obviously be important to you. Many advisers are paid by whoever they place your business with, and they may also charge you a fee. It is a condition of their regulation that they point out all these fees before you commit to any particular arrangement. However, you also need to understand what this fee pays for and the service you will receive. Smaller IFA practices may give advice on much wider issues such as Inheritance Tax Planning, Succession Planning and Long Term Care issues.
Our SOLLA accredited adviser (Stephen Sale) is not only qualified to be able to advise on Equity Release Schemes but give holistic financial advice on the wider issues associated with post-retirement planning including Equity Release schemes.
Our friendly and knowledgeable team of advisers are here to help and advise on a wide range of financial issues.
We offer an initial meeting to discuss your requirements and objectives, on a no cost, no obligation basis.
For your free initial consultation, call us on 0113 282 5017 or email: stevesale@blm-group.co.uk
This is a lifetime mortgage. To understand the risks, ask for a personalised illustration.
There will be a fee for mortgage advice. The precise amount will depend on your circumstances and may typically be £395.00