However, a further function of this increasing popular lifetime mortgage is its ability to put money towards another house purchase.

In essence, an equity release scheme is a mortgage secured on ones property; however unlike a conventional mortgage there are no monthly payments. Instead, the interest charged by the lender is added to the loan and rolls up in the mortgage account.

Therefore as long as the figures stack up an equity release mortgage can be used to bridge the gap between the deposit paid on a 2nd property and it’s full purchase price.

For more information call The Equity Release Bureau on Freephone 08009881289

Can this be achieved well the answer is now categorically – ‘YES’ Before discussing the Interest Select option in greater detail, let’s have a look at the two products launched. Stonehaven now have two propositions available to customers: -

1. Lump Sum  Option

2. Interest Only lifetime mortgage

The lump sum option does as it says on the tin; namely two lump sum options which offer different loan to values. Stonehaven are not launching at the maximum release end of the market, but aiming competitively with lower interest rates.

Lump Sum Lite has the lowest interest rate at market leading 6.13%.

Youngest applicant needs to be at least  55 & this product will release 11% of the property value at this age.

The Lump Sum plan has a higher interest rate of 6.24%, with a higher release of 14% at age 55.

Neither plan have a draw down facility, but a simplified single lump sum option from the outset.

Now on to the Interest Select product.

The innovative plan allows you to choose how much of the interest charged you would like to repay each month, and also how long you wish to pay this for. You could pay off the whole interest, or if you have a specific budget just pay off part of the interest with the remainder rolling up on the capital borrowed. In effect it can be classed as an interest only lifetime mortgage for for applicants above age 55.

One of the main benefits of the Interest Select plan is the ability of the mortgage to be converted over to a full roll up scheme at a later date. This could be when one party to the mortgage dies or financial circumstances dictate that no more monthly payments wish to be made. Simplification on the new Interest Select means that when conversion arises, the new rate on the equity release plan will only be 0.2% higher than on the previous Interest Select. However, better still, should the roll-over date be previously set, then roll-over will be at the SAME interest rate as the original interest only element. With interest rates starting at 6.13% which are currently the lowest in the market, a particularly attractive proposition can be found here for those who put heavy emphasis on interest rates.

Qualification Criteria for Both Schemes All Stonehaven equity release products are available to people aged 55 and over, living in a main residence in England and Wales & must have a minimum property valuation of £70,000. The minimum release has been reduced to £10,000

Additional Features:

No Negative Equity

This is the guarantee that when the property is sold on death or long term care, the proceeds payable to Stonehaven can never be greater than the property value itself. This guarantees there can be no excess debt passed to the beneficiaries.

Ringfence Equity

A valuable inheritance protection feature applicable to the lump sum plans. There is the facility to choose to protect a percentage of the final sale value of the property. Point to note is that the no negative equity guarantee and the amount that Stonehaven will lend are based on the value of the unprotected portion of the property.

To get more details on this innovative product call The Equity Release Bureau on Freephone 0800 988 1289

1. Valuation Fee
2. Lenders Application Fee
3. Solicitors Fees
4. Adviser Fee

o Valuation Fee – paid upon application & can vary significantly from lender-to-lender.
The fee as with any mortgage is directly related to the property value & can vary from a percentage of the property value to a banding system.
One area of savings here would be in the banding system. First establish what the bands are from the potential lender & ensure that you have not placed your property value into a higher band than required. Dropping to the one level below can save at least £30 – £100.The Equity Release Bureau has access to free valuation products, just call Freephone 0800 988 129 for more details.

However, bear in mind the valuation of the property will affect the maximum release so don’t jeopardise this figure if you are looking for as much as possible.

o Lenders Application Fee – these are usually fixed no matter the size of the release or value of the property.Some home reversion companies have no fee, as this is accounted for in the full or partial transfer of ownership.

Lifetime mortgages application fees however can vary from £500 up to £695. Again, special offers can be made by lenders or even cash-backs can be obtained to reduce the net costs overall.

o Solicitors Fees – due to the fact the solicitor can be selected, considerable savings can be made here.
Local or family solicitors can be contacted & a quote for equity release conveyancing requested. Borne within the quote would be the solicitors flat fee & any disbursements including VAT.
Consider obtaining several quotes from solicitors or take the recommendation of your independent adviser as they may have special fixed cost arrangements with solicitors from ERSA (Equity Release Solicitors’ Alliance).

o Advice Fee – dependent upon which brokerage advice is being sourced will determine how much the adviser is charging.
Care should be taken here. Fees of £1495 can be levied for taking out the same equity release plan as another brokerage may not charge any broker fee at all!

Some companies will also charge an upfront fee, some offer an initial consultation free of charge. Establish with the adviser how they are remunerated & shop around if you feel a better deal can be found elsewhere.
In summary, considerable savings can be made by conducting in depth research & dealing with a specialist independent firm of equity release advisers.

The Equity Release Bureau will guarantee to beat any like for like quote on your equity release plan so remember this when the time comes.

Many retired people who left their work before the crisis hit have had to watch in horror as a lot of the value they had expected to retire on has been wiped away by stockmarkets & low interest rates with the banks & building societies. Sometimes, what is left in the pension isn’t enough, and their reaction is that they should sell their house in order to ensure a comfortable retirement.

However, with equity release , this might not necessarily be required. Instead of selling the family home, why not release equity to cover the short term finances. We maybe only talking a small sum to tie you over until prospects improve. Therefore, for the sake of selling in a depressed property market, bide your time & think carefully about your options available. Equity release schemes can play an important role here.

Equity release schemes are form of mortgage that enables people over age 55 to release locked up equity in their main residence. The typical and most commonly thought of equity release schemes are actually called lifetime mortgages. Lifetime mortgages are available to those over 55, and have specific characteristics which reflect this unique stage in life.

Equity release schemes are like normal mortgages in that they are associated money & a property. However, where most mortgages are used to purchase the property over an extended period of time, equity release mortgages are new mortgages placed on properties which already have or virtually paid off the mortgage. The result is that while the property now has some debt associated with it, the value that is unlocked can be used for large scale projects or purchases, supplement pensions or more commonly home improvements.

The other difference between an equity release lifetime mortgage and a normal mortgage is that with an equity release mortgage the assumption is that the balance will be paid off when the person who holds the plan sells the asset or as a part of the inheritance estate. This is why the over 55 age restriction on equity release schemes is so important. These financial products are designed to run for the rest of one’s life, so there is no call upon the repayment of the capital until death or moving into long term care.

Many retired people watched the drop in markets sweep billions from the values of the pension funds, and therefore pushing significant financial pressure inwardly. It is easy to see how the equity release mortgage would be an excellent option for retired people who are struggling either for income or a capital lump sum. Where they were potentially considering having to sell the family home or go back to work, many retired people can supplement their pensions with the value withdrawn via an equity release scheme.

As lifetime mortgage & home reversion plans are now members of SHIP, you always have the option of repaying the scheme during your lifetime. However, be wary of potential early repayment charges which some gilt related schemes can significantly impose. One way providers can recover their costs is through these means.

Often people think that equity release is tantamount to putting debts on to the next generation. What is important to keep in mind that with lifetime mortgages the ownership of the property stays in the hands of the plan owner, just like a regular mortgage. In fact, usually the biggest difference between a normal mortgage and an equity release mortgage is that the terms of the equity release plan are more favourable as they consider the age of the owner of the plan, and factor that into the calculations.

This means that those who inherit the property may also inherit the debt, but they now have the option to decide if they want to keep the property with a normal mortgage, or sell the asset and recover the rest of the equity. These are options which can be passed onward in an estate, making it easier for the family to make decisions which are appropriate for them.

Selling one’s house is an emotive issue & needs to be discussed with those closest to you. Next step would be to discuss whether equity release schemes are a viable option & this is where Equity Release Bureau can use their considerable experience & knowledge to help.

For relevant equity release information and to compare equity release 0800 678 5159 who can offer words of advice.

It looks like Aviva & Just Retirement have stirred up a hornets nest within the equity release market.

Stonehaven equity release have stated they will be reducing their lifetime mortgage interest rates across their whole product range with effect from Monday 13th February 2012. With their benchmark gilt rate now falling to just over 2% they have reduced their interest rates accordingly & maybe more reductions to follow?

The greatest reduction has been on their interest only lifetime mortgage product – Interest Select Max which offers the highest loan-to-value. This has been reduced from 7.57% down to 7.10% monthly.

For comparison purposes, on a £50,000 Stonehaven Interest Select Max mortgage, the monthly payments would have reduced from £315pm down to £296pm. A saving of almost £20pm.

However, the greatest reduction is evident the lump sum product range & it seems Stonehaven are now trying to capture more of the lump sum equity release market. Hence their slightly aggressive stance in lowering below Aviva’s 5.92% rate announced only the other day. More than ever in this fast changing market consulting an experienced equity release adviser who will provide you with relevant equity release information and help you compare equity release is imperative when long to apply for and equity release scheme.

Their niche interest only lifetime mortgage has played a major role in assisting people who have been left stranded by the recent withdrawal of the Halifax Retirement Home Plan. Without the Stonehaven interest select mortgage, there would be no other interest only lifetime mortgage lender in England & Wales.

This is due to the fact that Stonehaven only lend in England & Wales, which means that people in Scotland & Northern Ireland still need to source alternative lenders should they be looking for interest only mortgages. Equity Release Bureau can still assist here but please contact us on 0800 9881289 for details.

Details of  Stonehaven’s new interest rates are as follows: -

Lump Sum Lite               5.89% (was 6.13%)

Lump Sum                      5.98%

Their range of interest only lifetime mortgage rates are as follows: -

Interest Select Lite         6.08% (was £6.13%)

Interest Select                6.17%

Interest Select Plus        6.46%

Interest Select Max        7.10%

If any of these new deals are of interest to you, please contact the Equity Release Supermarket team on 0800 678 5159 where an adviser can provide guidance as to which Stonehaven equity release mortgage would be suitable.

The very name of  impaired life or enhanced equity release plans sounds a little cold and cruel – after all, the actuaries at the insurance companies who produce equity release calculators have number crunched their statistics to come up with a more attractive plan if you are able to prove that you’re less likely to live as long as the average person.

However, just for once in this world, this is a type of financial plan that could definitely work in your favour if you are in poor health – it is the opposite for paying more life insurance premium if you’re not in the best health?

Bearing in mind that the standard equity release schemes will be based on an average life expectancy (of say around 80+ years of age), standard plans presume that the client will remain within their property for a certain number of years. Therefore, the equity release UK company will have to wait until the clients have either passed away or moved into permanent residential care before they are able to finalise the plan and reclaim their equity in the property.

If you qualify for the impaired life equity release scheme you would prove to the equity release provider that you are unlikely to remain within your property for such a long period of time and therefore the lender would be able to finalise the plan more quickly. This is where more favourable rates and payouts may be available to an applicant for an impaired life equity release plan and this can even be around 30% more advantageous.

Applying for an impaired or enhanced equity release plan is only slightly more involved than the standard lifetime mortgage or home reversion plan; you will be required to complete a short health & lifestyle questionnaire that asks if you have ever been diagnosed with certain medical conditions. At the end of the application, if it is presumed that your life may be impaired, you could qualify for a much bigger lump sum from your equity release plan.

Just as it is possible to use an equity release calculator to ascertain the expected level of payout for a standard policy, so too can you use this tool to work out what level of payout would be available for an impaired life equity release plan. However, these impaired life equity release calculators are not always entirely accurate, speaking to an experienced adviser can provide you with more relevant equity release information These reason being is that some enhanced equity release lenders such as more2life have varying degrees of enhancement. This is due to the severity of the ill-health the applicant maybe experiencing. The greater the number of illnesses, the greater the potential equity release tax free lump sum. Because of the

There are very few times in this life where ill health can actually deliver a better financial reward, but with impaired life equity release schemes from the likes of: -

•             AVIVA – Lump Sum Max plan

•             PARTNERSHIP – Enhanced Lifetime Mortgage

•             more2life – Enhanced plus Lifetime Mortgage

If you can get past the actuaries working for these equity release providers and would really appreciate some much needed cash at the moment, investigate the possibility of such an impaired life plan and get out there and start living your life to the full.

Equity Release Bureau has access to impaired or enhanced equity release schemes. These come with exclusive offers such as free valuation & cashback deals so why not compare equity release plans now.

To find out more contact us on Freephone 0800 988 1289.

Innovative by nature, Stonehaven offer the equity release market two alternatives in deciding which form of equity release suits you best – an interest only mortgage, or a roll-up equity release scheme.

Dependent upon your requirements, Stonehaven will have a scheme to suit, & also a competitive interest rate to match any other equity release schemes available.
You also have the protection of knowing that Stonehaven are also members of SHIP EQUITY RELEASE.

Stonehaven’s principle offering is their Interest Select plan which in essence is an interest only equity release mortgage deal. The plan allows you to maintain monthly interest payments for the rest of your life. By repaying the interest only element, you can be safe in the knowledge that the original mortgage balance will remain exactly the same for lifetime of the mortgage.
The second type of Stonehaven scheme is their selection of roll-up equity release scheme which are popular with many pensioners today, as it allows them to release tax free cash, but this time with no monthly payments.

June 20th, 2011