People often contact us with questions about equity release which we are not qualified to talk about but see below for a reputable advisor who will be happy to explore your options with you.
What we can say is that people ought not to feel forced to seek equity release to pay for care: a recent article on Radio 4 seemed to me to give the impression that once a care home resident’s money ran down to £23,250 the person was ‘on their own’ in trying to secure funding for care. This is not true. However, people may want to take out equity so that they have the care at home that they want and which costs more than the local authority is willing to pay. The same goes for care homes. So we are not telling people whether they should or should not pursue equity release but that this is not a necessity – local authorities have to pay for care where the recipient does not have the funds to pay their own care bills.
Note that we are not ‘recommending’ Simon but are offering him as an expert as an option to help you with any equity release/later life lending questions…
Later Life Lending Options – Introducing SPF Private Clients
The most common form of Later Life Lending is a Lifetime Mortgage. Lifetime mortgages are available to borrowers over the age of 55 and provide a sum of money secured against the borrower’s home via first legal charge in the same manner as a conventional mortgage. Interest rates are usually fixed for life and borrowers can either pay some or all of the interest or choose to make no payments and add the interest to the loan. The loan and any interest are repaid when the borrower (or last borrower for joint applications) dies or moves into care. Lifetime Mortgage loan sizes and interest rates are based on the borrower’s age and the value of the subject property. They are not assessed against income or affordability.
It is essential that all alternatives are considered when establishing the most suitable solution, these may include:
• Home Reversion Plans. These schemes allow the homeowner to sell a percentage or all of their property at below market value and live there rent free until they move into care or die. At this point the home is sold and the reversion company gets its share (or all) of the proceeds.
• Retirement Interest Only Mortgages. These products allow you to borrow a lump sum secured against your home, pay monthly interest on the loan and repay the debt when the borrower (or last borrower for joint applications) dies or moves into care. These mortgages are assessed against retirement income and in the case of joint applications, on a ‘sole survivor’ basis.
• Mainstream Residential Mortgages. An increasing number of lenders are willing to offer conventional mortgage terms to older borrowers and SPF’s expert advisers are able to investigate these options on the borrower’s behalf.
SPF Private Clients (SPF) offers Lifetime Mortgages and Retirement Interest Only Mortgages from the full range available to mortgage intermediaries through an experienced team of expert advisers. Whether you are looking to repay an existing mortgage or seeking to release funds for personal use, tax planning purposes or to assist family members, SPF can assess your circumstances and advise on the most suitable option.
SPF’s commitment is to provide clear, impartial advice and to deliver a first-class service both during the mortgage application process and after the mortgage has completed.
SPF are members of the Equity Release Council and are authorised and regulated by the Financial Conduct Authority (FCA).
Simon Dexter, Director
t: +44 (0)20 7330 8577 m: +44 (0)7968 553 337 e: sdexter@spf.co.uk w: spf.co.uk
SPF Private Clients, 33 Gracechurch Street, London, EC3V 0BT
Simon Dexter has been working for SPF since 2003. He has extensive knowledge of the UK mortgage market and is experienced in providing bespoke solutions for complex mortgage requirements. Recently, Simon recognised the financial requirements and challenges that some of his more mature clients are now facing and decided to become an adviser in the Later Life Lending sector. Prior to this, Simon successfully managed one of the largest teams of mortgage advisers in the London office of SPF and before that, was a high-net-worth Investment Adviser with Barclays International, which he joined in 1987.
