Are You Eligible For An Equity Release Scheme?

According to AXA research at the start of November almost one in five 25-34 year-olds plans to use an equity release scheme when they retire to supplement their income. With this potential increase in equity release popularity we thought it would be useful to highlight the criteria required to make the most of an equity release plan.

Aged 55 or Over

The age guidelines can vary depending on which equity release provider you use but most state 55 years old as the earliest age you are eligible for an equity release scheme. With the average age of retirement thought to increase in the future many people might decide to use an equity release scheme to support earnings in preparation for their retirement. The age threshold changes to 65 years old for home reversion plans.

Your Home Must Be Worth At Least £60,000

This is another requirement that is likely to change depending on the equity release provider you use. Age Partnership has set their threshold at £60,000 to help a greater percentage of homeowners make the most of an equity release plan.

It Must be Your Permanent Residence

The property which you are using for an equity release plan must be your permanent address, which you live in for six or more months during the year. If you decide to move house after taking out a lifetime mortgage equity release plan you should be able to transfer it to your new property. If you are moving to a smaller property, you may be required to pay off a percentage. This doesn’t apply to home reversion plans.

You Must be Able to Clear Any Outstanding Credit

If you have any outstanding payments to make on your mortgage or any other credit taken out against the property, you must be able to pay this off with your equity release scheme. A lot of people use an equity release scheme to reduce or clear debt so that they don’t have the stress of making regular payments during their retirement.

The Property Should be in Good Standard

The property should be in a good state of repair and should be freehold or leasehold.

If you meet all of these requirements and you are interested in an equity release plan the next step is to contact a specialist advisor. Age Partnership is a leading, independent equity release specialist and they can offer you information about whether or not an equity release plan is suitable for you. They are also happy to discuss alternative means of finance that may better suit your circumstances.

They will offer a free, no-obligation quotation and should you wish to proceed with an equity release plan, they offer a no-negative equity guarantee so you will never owe more than your property is worth.

Related posts:

1. Why should I apply for an Equity Release Scheme?
2. Can You Reduce The Cost Of Setting Up An Equity Release Scheme?