Capital release traditionally targets homeowners of retirement age. Many equity release lenders insist that all applicants are over the age of 60, but Age Partnership has access to plans for everyone 55 and older. To consider this, you must be near the end of your current mortgage term to avoid paying early repayment fees. Currently, there are nine lifetime mortgage lenders who offer their plans through truly independent advisors and are members of the Equity Release Council.
While home reversal plans can provide you with more money than a lifetime mortgage, the biggest drawback of a home reversal is that it involves selling part or all of your home. Some lenders do not have an upper age limit, while those that do, tend to set the maximum age for capital release quite high, at 90 years of age. No, the minimum age for capital release is 55, although some lenders will accept applications shortly before your 55th birthday, so you can schedule termination to occur soon after, avoiding delays. The most popular form of modern capital release is a lifetime mortgage; they are equivalent to over 99% of the equity release plans I recommend.
At 55, if you want to release 25.00% of the value of your property, the best interest rate would be 4.64% (AER). You can even replace any existing mortgage with one that costs you less each month, while also providing you with the release of the capital you need. Aviva was the first provider of lifetime mortgages in 1998, with more than 250,000 customers releasing more than £8 billion from their homes. Consult first with an independent financial advisor or mortgage broker who specializes in releasing capital.
If you are interested in freeing up capital, please contact the Age Partnership team at 08080 555 222 and they will discuss all options, including the impact it could have on the size of your estate over time and whether your entitlement to current and future revenue-controlled benefits may be affected. The main disadvantage of freeing up equity is that it doesn't pay you the full market value of your home. If you have experienced credit problems in the past, you usually don't count against you on releasing capital (unlike ordinary mortgages) because you are not required to make any regular repayments. The obvious advantage of freeing up capital is that it gives you money to spend now, rather than leaving you locked up in your house.