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Can I change my equity release plan?

Category:
Your Money
Wednesday 03 June 2020
An equity release plan is designed to run for the rest of your life, but that doesn’t mean you have to stay on the same plan or even with the same provider. Just as your own needs change, so does the equity release market meaning you could find a better deal that wasn’t available to you before.
 
Reasons to consider switching:
  • Lower interest rates; you’ll accrue less interest on your loan over time, which means you could save thousands
  • Plans with benefits that could better suit your needs
  • Borrowing more if your house has increased in value
  • Borrowing more if you now have a health condition and can take advantage of an ‘enhanced’ plan
  • Releasing further funds if you took a drawdown option and have used all the money
  • Borrowing more as you are now older
 
Securing a better interest rate
People who have taken out equity release in the past, may find their existing plan uncompetitive. By switching plans to a lower interest rate, not only could you save money – potentially thousands – it could also mean you could leave more inheritance for your loved ones or have further equity available in the future.
 
Accessing more money
If your financial situation has changed, unlocking more cash from your home could be an option if you switch your equity release plan. Your house may have increased in value over time, meaning you could borrow more.
 
If your health circumstances have changed, you may be able to take advantage of an enhanced plan, meaning you could release more.
 
Find a plan that suits your needs
Your circumstances may have changed since you first took out equity release and it’s possible that a new plan could have features that better suit what you want or need.
 
Plans are far more flexible now. There are options to repay the interest, meaning less of a build up over time. If you are on a lump sum plan now, there may be a chance to take out a drawdown instead with a smaller initial amount and the option to take out further sums in the future when you need it.
 
You could also add features to your new plan, such as inheritance or downsizing protection, to ensure it’s still right for your needs.
 
Is now a good time to switch?
Average interest rates for equity release plans have dropped in recent years. According to the Equity Release Council’s Autumn 2019 Market Report, in the summer of 2016 the average fixed interest rate reached almost 6%. In July 2019, this fell below 5% for the first time with many plans now available at much lower rates than this.
 
It’s free to check
If you do have an equity release plan and want to discover whether you could secure a better deal, The Equity Release Experts will handle everything. Part of Key Group, one of the UK’s largest providers of equity release advisory services, The Equity Release Experts will compare plans from across the whole equity release market and ensure they consider all elements of your existing policy, to find the best deal for you.
 
As they’re independent, they have no ties to any providers, so you’re guaranteed advice that’s straightforward and tailored to you – nothing else.
 
Your expert adviser will explain how equity release will reduce the value of your estate and may affect your entitlement to means-tested benefits. A lifetime mortgage is a loan secured against your home.
 
Unless you decide to go ahead The Equity Release Experts service is completely free of charge as the usual advice fee of 1.99% of the amount released would only be payable on completion of a plan subject to a minimum advice fee of £1499.
 
Why not find out if you could secure an equity release deal that’s better for you? Call The Equity Release experts, or they can call you.
 
Call them on 0800 188 4812.