Northwest Equity Release

Northwest Equity Release

Northwest Equity Release

Northwest Equity Release

Northwest Equity Release


Lifetime Mortgages are regulated by two separate bodies. The Financial Conduct Authority (FCA) and the Equity Release Council (ERC).

For me to be able to provide advice on Lifetime Mortgages the FCA states I have to be specifically and specially qualified. Most independent financial advisers (IFAs), solicitors, accountants and bank managers don’t have the required qualifications.

Apart from providing oversight, the ERC also provides three guarantees for the plans they supervise. All the plans I recommend are protected by these guarantees as follows:

The right to stay in your home for life.

The right to move home if you want to and take the mortgage with you, subject to terms and conditions.

A no negative equity guarantee.

The right to stay in your home for life
Let’s be clear, with a Lifetime Mortgage you don’t sell your home. You remain the owner, just as you did if you had a mortgage earlier in your life. The lender, or provider, takes a first legal charge over the property, exactly the same as your earlier life mortgage. The Lifetime Mortgage comes to a natural conclusion when your home becomes empty, on the event of the second person (if a joint application) going into long term care or passing away. At this point, your beneficiaries would sell the property and repay the outstanding balance. Or it could be bought by a family member and the loan repaid in that way. Any surplus proceeds go back to your estate for distribution as per your will instructions.

The right to move if you want to
You can move home in the future and take the existing mortgage to your new home. However, the amount outstanding must “fit” within the new property value, and the new property must be acceptable to your lender as security.

No Negative Equity Guarantee
Simply put, you won’t leave a debt for your beneficiaries. When the property’s sold, at a fair market price, if there’s insufficient value in your home to repay the mortgage in full, the lender absorbs the shortfall.

Regulation states that you must take independent legal advice when taking a Lifetime Mortgage. You can absolutely use your family solicitor, or choose one from the high street but I recommend you use a Specialist Equity Release Firm. for the following reasons.

They work in this market place on a day to day basis and are not distracted by other aspects of a normal legal practice. This is important as they get to see all the “road bumps” that people encounter on a regular basis resulting in faster completion times, usually two to three weeks quicker than a non specialist.

They work on a fixed fee basis whereas non specialists most likely charge an hourly rate. This means there are no hidden costs from the outset. In addition, the Specialist Firms work on the basis of “no completion, no fee”. This means that you could withdraw from the application process right the way up to the completion date and there would be no fees charged. All you would be liable for would be the costs of the legal disbursements, local searches for example.

Unlike conventional conveyancing, the Specialist Solicitor has to sign a certificate stating they have assessed your understanding of the transaction you are about to enter, you have the capacity to make decisions and that you are not under any influence to proceed against your will. This is a fundamental part of the process for additional security and peace of mind.

The last advantage of using a Specialist Firm is they come to you to have the paperwork completed and signed so you don’t have to travel into town and find parking!

Finally, Equity Release has the protection of the Financial Services Compensation Scheme (FSCS).

With all the regulation in place, the requirement for independent legal advice as part of the process, working with an Equity Release Specialist, you can rest assured you’re in safe hands.