Equity Release Companies To Avoid

Equity Release Companies To Avoid – Since 1991, the Equity Release Council has legally governed equity release, imposing strict regulations that protect the consumer from companies looking to rip off investors. However, here are the 4 questions you should ask, help you avoid the wrong equity release services:

equity release companies to avoid

Are they licensed by FCA and a registered member of the ERC? This means that they have met the strictest requirements of an ERC member and are therefore bound by the ERC rules. The ERC rules include a prohibition against requiring the client to provide any means-tested benefits in order to obtain a release. If a company is seeking such a release for a relative who is under disability, then the only means-tested benefits that may be used are those provided for children through Medicaid and child care programs. As for early repayment of an inheritance, no such benefit is available as the estate is not considered to be a qualified debt.

Does the equity release provider consolidate monthly repayments? While each of the loans involved in the plan may have their own specific terms (e.g., interest rate, term, payback amount), not all providers will be willing to consolidate the monthly repayments into one loan amount. The loan amount should be made clear to the client well in advance. If the loan amount can be changed at a later stage, it should be done so.

What are the advantages and disadvantages? One advantage is that the service provides an equity release solution to retirees and their dependents who are living on a pension, regardless of their age. Also, the advantage is that you can use this service without providing any information about your financial circumstances, allowing your financial adviser to recommend the best solutions to your needs. This also allows the adviser to look at other aspects such as interest rates, life expectancy and retirement ages.

What are the disadvantages? One disadvantage is that if you request a release on a property you hold, you will lose your ownership of that property, unless you pay compensation upfront. It is recommended that you obtain an appraisal to determine the fair market value of your home before deciding whether to opt for a repossession or an equity release. Some financial advisers will offer a no-obligation consultation meeting that can help you decide whether the benefits outweigh the disadvantages. The consultation could include an in-depth discussion of the property’s potential sale and redemption value and other considerations.

Is a no equity release plan right for me? Only you can determine if this type of plan is right for you. It is a good idea to discuss these issues with a qualified financial adviser. The pros and cons of this type of pension and retirement planning option can be significant depending on your age, lifestyle and other financial commitments.