Equity Release – a gift you could give to your children

27th March 2019

Nowadays, stepping onto the property ladder for many people could seem out of reach due to the recent rise in house prices alongside a sluggish growth in wages. However, the money you have invested in your own property over the years could be released to help someone you care for buy their own home for the first time.

Ask most parents what they want for their children and they would most likely say for them to be happy, healthy and financially secure. Financial security often means having a well-paid job and your own house to live in. Yet nowadays, stepping onto the property ladder for many people seems out of reach due to the recent rise in house prices alongside a sluggish growth in wages. Most mortgage lenders would lend you on average 4 times your single or combined spouse salary, and for many people nowadays this just isn’t enough to purchase a property. The shortfall seems to be in the ability to put down a larger deposit – and this is where the ‘Bank Of Mum And Dad’ could help out.

The BANK OF MUM AND DAD – the new major lender in UK housing.

If a willing contributor has accessible savings to contribute to a deposit then this could be the answer to the deposit problem. Nevertheless, realistically we don’t all have a hidden pot of money at our disposal to use as we please. Or do we? If you own your own home, are aged 55+ and live in the UK then the money tied up in your home could be released to assist a loved one in purchasing a family home of their own.

Equity release – help your loved ones get onto the property ladder.

Gifting is a financial tool you could use Equity Release for. If you are a home-owner then you could release some of the equity in your property to gift to a loved one to help them buy their first, or even second home.

So how does it work?

A Lifetime Mortgage allows you to release money from your home without having to move. It’s a loan that is secured against your property, at a fixed rate of interest that can be taken out either as a lump sum or spread over a number of years using a drawdown facility. Like a traditional mortgage, you can choose to pay back only the interest on the initial loan or pay back both the interest and the capital in regular monthly instalments, subject to criteria. However, unlike traditional mortgages you also have the option to make monthly repayments and let the interest roll up to be repaid from your estate along with the original loan amount once you or the last surviving applicant dies or goes into long term residential care. Whatever Lifetime Mortgage plan is most suitable for your personal circumstances there will always be a ‘No Negative Equity Guarantee’ meaning that you will never owe more than the value of your estate and you can stay living in your own home.

Equity Release – a gift you could give to your children

The first step onto the property ladder has always been difficult but in today’s financial climate it seems to be further out of reach for many than it ever has been. If gifting to your children through Equity Release is something that you would like to consider, in order to help them make that incredibly difficult leap onto the first rung of the housing ladder in a seemingly impossible housing market, then why not contact Kevin Woods on 01489 454545, or at kevin@laterlivingnow.com to discuss your situation in confidence and without charge or obligation of any kind. After the gift of life, it could be the best gift you will ever give to your children.

Why not get in touch and see how we can help?

Equity release could be the answer to some of your financial questions. If you would like to know more about it, and see if it could be the right option for you, please book an appointment or request a call-back

Providers include

Pure Retirement

Equity release will reduce the value of your estate and may also affect your entitlement to means-tested benefits. You should always think carefully before securing a loan against your home.

Unless you decide to go ahead with a plan, our service is completely free of charge, as our fixed advice fee of £1,695 is only payable on completion of a plan.

A lifetime mortgage is the most popular form of equity release, and is a loan secured against your home that’s typically repaid when you pass away or go into long-term care.