How can I access my property wealth without selling or downsizing ?

Equity Release has changed, for good.

Decades ago, equity release products did not come with a "No negative equity" gurantee, and the products were not very consumer friendly. This is why we still hear the "horror stories" from some people who released equity years ago.

However the modern equity release products are different. They are regulated by the Financial Conduct Authority, FCA and the industry body Equity Release Council has set strict standards which all the members should observe. As a result, equity release products today are almost unrecognisable from the products of the past. This is a great victory for the industry and the consumer.

The good news is equity release products are continuously evolving and becoming more and more consumer friendly. Today, equity release has become a credible, useful financial/retirement planning tool amongst many financial advisers.

Is Equity Release right for me?

The answer is , we don't know until we do a thorough analysis of your financial and personal circumstances. This is the job of a independent equity release adviser.

However Equity Release might not be right for you in the following situations:

• You want 100% of the property value to be passed on to your beneficiaries

• Your property is in Trust, and the Trust cannot be revoked

• You are looking to sell your property in the near future

• You have already seen a qualified independent equity release or a financial adviser who advised against it.

• You have other alternative ways of raising money such as your own savings and investments.

But its always worth a chat with an expert, as your personal circumstances can change over time.

Do I qualify for Equity Release?

Unlike with traditional mortgages, equity release does not require an affordability test. Which means you do not have to prove your ability to make payments as you are simply not required to do so. This applies to most equity release plans unless its the recently introduced Payment Term Lifetime Mortgage or a variation of it, which we will go through in detail later. There are two main requirements to qualify with many equity release plans:

• You have to be 55 or over. (There are new products being made available for people over 50's but most products need you to be 55)

• You own a UK property which is your main residence (with or without a mortgage) and the property is in good habitable condition

Reasons your property might not qualify (or limit your options) for equity release: The thought process behind the following is "Is your property a "good risk" to a lender, in their view?". Lending criteria changes often , so its worth giving me a call on 07543 169733 to discuss even if you think your property might not qualify. Remember , most properties do qualify, and the list below is not exhaustive and only for guidance.

• Your property has spray foam and you want to keep it. Spray foam is a no no for most equity release lenders. However some lenders will consider your property if you are willing to remove it using a professional spray foam removing firm. When it comes to spray foam, it usually does not matter where the spray foam is in the house , the lenders take a dim view of this. Recently I saw a client who has spray foam in his cellar ! And I am struggling to find a lender.

• Your property is full of clutter and a valuer cannot access your property and make a fair assessment of the structure or other elements of the property necessary to produce a valuation report.

• You own a flat, with a short remaining term on the lease . I recently spoke to a 65 year old lady who wanted to release equity to refinance her mortgage, but when we looked at the property lease she only had 63 years remaining. Most lenders would require around 120 years at least remaining on the lease. So my client had to go to the freeholder and agree a lease extension. The good news is , if the lease extension is agreed and the costs can be covered by equity release , an equity release lender will accept an application but the lease extension has to complete at the same time (or before) the equity release application completes. This is called a simultaneous completion. This is exactly what my client did.

• You own a flat with "high" ground rent / service charge or/and your ground rent increases frequently i.e doubles every 5 to 10 years

• Your property is above a shop or very close to commercial premises such as shops , pubs etc- This "could be" an issue with many lenders but each lender has their own different view and risk appetite. In the end its all down to saleability of the property so its worth checking with an adviser.

• Your property suffered from subsidence, heave or landslip. This is usually a decline with lenders.

• Your property has suffered from floods and your home insurance premiums are "loaded"(increased) due to this.

• Your property is not used as your main residence. i. e you live in your property for only 3 to 4 months a year or its a holiday home, or you let it out. These are not usually acceptable.

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