20 minute read
A SECURE FUTURE
A SECURE FUTURE WITH EQUITY RELEASE?
Advertisement
THESE days we have to look at a variety of ways to raise cash and ensure that our future will be secure and one popular way for anyone over 55 to do just that is via equity release, which offers the chance to access the cash – the equity – tied up in your home. It can be as a lump sum or in several small amounts, or a combination of both.
There are two equity release options: lifetime mortgage and home reversion.
The Money Advice Service explains that a LIFETIME MORTGAGE means that you take out a mortgage secured on your property, provided it is your main residence, while retaining ownership.
You can choose to ring-fence some of the value of your property as an inheritance for your family or you can choose to make repayments or let the interest roll-up. The loan amount and any accrued interest is paid back when you die or when you move into long-term care. Most people who take out equity release use a lifetime mortgage. Usually you don’t have to make any repayments while you’re alive and interest “rolls up” (unpaid interest is added to the loan), meaning the debt can increase quite quickly over a period of time. However, some lifetime mortgages do now offer the option to pay all or some of the interest. Some will let you pay off the interest and the capital.
In the same way ordinary mortgages vary from lender to lender, so do lifetime mortgages, and if you’re looking at this option it’s worth knowing that the minimum age for this is usually 55. As we’re now all living longer, the earlier you start the more this is likely to cost in the long run.
The average borrower in their late 60s can usually borrow around 35% of the value of their home, but how much can be released is dependent on your age and the value of your property. The percentage typically increases according to your age when you take out the lifetime mortgage, while some providers might offer larger sums to those with certain past or present medical conditions. Many lenders offer interest rates which are fixed or, if they are variable, have a “cap” or upper limit which is fixed for the loan’s duration.
Check whether the product has a “no negative equity guarantee” This means that, when your property is sold and agents’ and solicitors’ fees have been paid, even if the amount left is not enough to repay the outstanding loan to your provider neither you nor your estate will be liable to pay any more.
Consider whether you can pay none, some or all of the interest. If you can make repayments, the mortgage will be less costly. However, with a lifetime mortgage where you can make monthly payments, the amount you can repay might be based on your income. Providers will have to check you can afford these regular payments.
Look at whether you can withdraw the equity you’re releasing in small amounts, as and when you need it, or whether you have to take it as one lump sum. The advantage of being able to take money out in smaller amounts is you only pay the interest on the amount you’ve withdrawn. If you can take smaller lump sums, check if there is a minimum amount.
It’s also worth finding out if you have the right to move to another property, subject to the new property being acceptable to your product provider as continuing security for your equity release loan, as different lifetime mortgage providers might have slightly different thresholds.
A HOME REVERSION involves you selling part or all of your home to a home reversion provider in return for a lump sum or regular payments. You have the right to continue living in the property until you die, rent-free, but you have to agree to maintain and insure it.
You can ring-fence a percentage of your property for later use, possibly for inheritance - the percentage you retain will always remain the same, regardless of the change in property values, unless you decide to take further cash releases. At the end of the plan, your property is sold and the sale proceeds are shared according to the remaining proportions of ownership. You will get a lump sum or regular payments – normally between 20 per cent and 60 per cent of the market value of your home, or the part you sell.
With home reversions, it’s worth checking whether or not you can release equity in several payments or in one lump sum and the minimum age at which you can take out a home reversion plan. Some providers insist you’re at least 60 or 65 before you can apply.
Keep in mind the percentage of the market value you will receive. This will increase the older you are when you take out the plan but might vary from provider to provider. Also check whether you have the right to remain in your property for life or until you need to move to long-term care, provided the property remains your main residence and you abide by the terms and conditions of your contract.
Again, check whether you have the right to move to another property, subject to the new property being acceptable to your product provider as continuing security for your equity release loan and whether the product has a “no negative equity guarantee”. You will also need to know what level of maintenance you’ll be expected to carry out and how often your property will be inspected – this could be every few years.
Overall, equity release might seem like a good option if you want some extra money and don’t want to move house, but it’s worth bearing in mind that equity release can be more expensive in comparison to an ordinary mortgage. It’s also worth considering any additional changes taking out equity release could make to existing arrangements, with the potential to lose means-tested benefits being key among them. It’s also worth considering involving your family throughout the process, as any equity taken out of the home will impact their inheritance later down the line.
Unlock tax-free cash from your home
with theUK’sNo.1 equityreleaseadvisor *
Tax-freecashto spend asyou wish
No monthlyrepaymentsrequired
Maintain 100% homeownership 1
Speak to one of our advisors for your free, no obligation quotation and to find out how much tax-free cash you can access to spend as you wish. They will explain how equity release could affect the amount of inheritance you can leave and if your entitlement to means-tested benefits could be affected now or in the future.
Equity release may involve a home reversion plan or a lifetime mortgage which is secured against your pr operty. To understand the features and risks ask for your personalised illustration. Equity release requires paying off any existing mortgage. Any money released, plus accrued interest, would be repaid upon death or moving into long-term care. Only if your case completes would a typical fee of 2.25% of the amount released be payable (minimum £1,695). 1 You only continue to own your own home with a lifetime mortgage. 2018 - Q1 2020. *UK’s No1, based on volume of plans, source: Touchstone data
To find out how much money you could release and to request your FREE guide call Freephone 0800 141 3628
R E QU E S T Y O U R F RE E G U I D E
TheUK’s No.1 Equity ReleaseAdvisor*
I would like my free guide to equity release
Name...................................................
Address...............................................
Postcode............................................
Telephone...........................................
We may contact you via telephone regarding your enquiry.
HOW TO DEAL WITH PANIC
By Dr Lynda Shaw, neuroscientist, business psychologist and change specialist.
COVID-19 is alarming for all of us, and for many our anxiety levels are on high alert which in the long term can be at the expense of our mental and physical health. So what should you do when the anxiety is getting too much, or you are starting to feel panic.
Uncertainty is difficult - The brain finds ‘the unknown’ the hardest to deal with and research shows that uncertainty is scarier and more alarming than known outcomes, even if they are bad outcomes. Control and organise what you can to a reasonable extent if it brings you comfort but don’t fixate and go to extremes including at the expense of other people.
Anxiety is bad for our health - Long periods of raised stress hormones like adrenalin and cortisol impact almost every part of our body. Side effects include increased blood pressure, muscle tension, insomnia, and headaches which can ultimately lead to an increased risk of serious illnesses. So whilst this is a difficult time, make time for activities that relax you and release feel good hormones like yoga, reading or cooking. Turn off news alerts on your phone if they are making you feel on edge.
Make good use of the time. Think about what you can do if you are going to have a prolonged period at home. Is it time to do some gardening, paint the house, get fit indoors, sort the paperwork out or take up that homebased hobby you always said you never had time to do. Fight and flight hormones – When faced with a perceived threat the body responds by releasing stress hormones like adrenaline and cortisol, readying you for action. These hormones narrow down our focus in order to concentrate on survival, which decreases our productivity. Stress can reduce work productivity by on average 25%. Prioritise deep breathing exercises and if you have some outdoor space, getting into it each day.
Stopping socialising can obviously
deeply affect our mood. Humans are social creatures and when we hang out with people we like, feel good hormones like dopamine and oxytocin are released and reward neural activity is stimulated in the brain. We feel good and have nurtured ourselves without even realising. Communicate using the wonders of technology. Arrange virtual coffee mornings and dinner parties on WhatsApp and Skype so you can see your friends and loved ones faces, especially those that might be feeling lonely.
We often see the very best in people in
very difficult times. Think if you can help any family members, friends or neighbours in any way, whether that is going for the shop for them or picking up meds. We also really need to support the frontline ie our medical workers.
Catastrophising and panicking about what might happen rarely helps.
Acute anxiety is an immediate reaction to a real danger, like a near miss whilst driving, but chronic panic is the fear of change, of something that might (or might not) happen in the future and anticipating a bad outcome. It causes you to live in a state of trepidation and confusion. Don’t let your imagination run wild and accept that some things in life are unknown and unpredictable. Be confident that you have the strength and versatility to overcome challenges when required and that this difficult period will pass in time.
Being panicked makes people
susceptible to ‘fake news’ – when the brain perceives a threat, it works very hard to neutralise the hazard and make you safe again. People are naturally inclined to believe information that lies close to their current inherited beliefs even if they are not based on solid science. Stress hormones decrease your rationality and critical thinking and make you more susceptible to inaccurate information. Avoid listening to other’s ‘strong opinions’ and check government websites for official advice.
Anxious minds do not sleep well - Sleep loss only adds to the stress which is the very thing stopping us sleeping. When you are overtired you have trouble concentrating, are less productive and feel irritable. Don’t watch or read about the news just before bed if the content is making you feel dismayed. The benefit is two-fold because screen time is known to delay the onset of sleep. Have a relaxing bedtime routine revolving around reading a book, a warm bath, or a bit of mindfulness.
Fear can be transmitted to other
people – Chronic anxiety about potential future dangers can cause low mood, short tempers and grouchiness. Children in particular will pick up on your anxious mood and sense of dread which can trigger their own feelings of stress. Be aware that this happens and control your emotions, so they don’t control you or infiltrate those around you. Its ok to talk to your children about difficult subjects because it actually makes them feel more secure that things are not being hidden from them, but too much detail or making them very scared really doesn’t help.
Don’t descend into treating each
other badly – During times of confusion and anxiety our stress hormones rise, we sleep less and consequently can be more irritable and shorter tempered. Be aware that this happens and make a conscious effort to smile and be positive. Positivity also rubs off on people, so smile and find things to laugh about, one of our best healers.
Prioritise self-care like eating well, exercising, virtual socialising, doing your hobby, planning nice things to do when this is all over, reducing your time on social media and sleeping as best you can.
www.drlyndashaw.com
TOP 5 ESSENTIAL LEGAL QUESTIONS TO CONSIDER DURING THE CORONAVIRUS PANDEMIC
During the Coronavirus pandemic, Ridley and Hall Solicitors have worked hard to stay open and meet the legal needs of everyday people across Yorkshire and the rest of the country. Certain legal matters have been really important to people over lockdown and we feel it is important to make the public aware of the things that they might need to give some thought to. Below are our top 5 questions issues which you might want to consider.
1. Have you made a Will and a Lasting Power of Attorney?
Even at the best of times, it can be hard to frame your mind towards putting in place plans for when you pass or way or lose the mental capacity to manage your own affairs, but at a time of such unprecedented health crisis, it is more important now than it ever was. It ensures not only that your property is dealt with as you wish and those you wish to benefit do so, but getting specialist advice from a solicitor significantly reduces the risk that your wishes and intentions are not followed. It may also help to reduce the risk that someone challenges your will or brings a claim against your estate when you die.
2. Is it time to downsize or consider a move?
With property sales and purchases grinding to a standstill during lockdown, things are picking up. If you are thinking of downsizing or taking your next step, now couldn’t be a better time for many because of the Government’s decision to put a hold on Stamp Duty, which applies until 31 March 2021. This will save many people thousands of pounds which can go towards your furnishings instead, or add the extra money to your budget.
3. If you’re staying put, do you and your spouse own your property in the right way?
Many don’t realise that co-owners can hold their property either as Joint Tenants or as Tenants in Common. Owning as Joint Tenants is great for many people throughout much of their lives, as the untimely death of the first means that the survivor owns the whole property. However as we get older, we need to think about whether this is still suitable. What if, for example, the survivor needs to pay for long term care as they age, potentially having to sell the house and use all of the proceeds to pay for care.
Considering changing your method of ownership to Tenants in Common means that each of you owns a 50% share of the property and you can each leave your share to others in your will when you die, such as your children. This means that the survivor of the two of you doesn’t inherit the other’s share, which is helpful if the survivor ends up needing to pay for care.
4. Not married? Consider sorting out a cohabitation agreement.
Given the uncertainty of the current climate, if you are living with a partner who you are not married to, now would be a good time to discuss a cohabitation agreement with them. Cohabitation agreements give certainty to both partners about what will happen if things don’t work out. There has been a huge increase in separations over the pandemic. If there is no express agreement between you, disagreements can be very time consuming and costly to sort out. A cohabitation agreement can set out exactly what both of your expectations would be about payment of bills and division of assets if you do decide to separate.
5. Looking to get married as soon as lockdown is over? Think about getting a pre-nup!
If you are getting married, then protecting your assets once married is a big consideration. Entering into a pre-nuptial agreement can ensure that you provide security for your children, as well as yourself. Without a prenuptial agreement, it is possible for either one of you to make claims against the other’s assets, whether acquired before the marriage or not. Prenuptial agreements have in recent times become more enforceable than they were, as long as certain criteria are met – one of them being that they are entered into at least 6 months prior to the marriage. Again, in this time of uncertainty, providing for family members when there is a wedding can provide comfort to yourself, your partner and family members.
The Grandparents Legal Centre (GLC) are specialists in advising about the steps grandparents need to take to resolve particular legal issues which occur in their prime years.
Our mature clients have grown-up children, grandchildren, changing financial and property needs and will also be planning for retirement or are already retired.
Our specialist solicitors understand your challenges and can give you tailored legal advice to suit your situation.
We offer services in;
• Children and Grandchildren
• Wills, Lasting Powers of Attorney, Court of Protection & Probate
• Care Home Fees Claims
• Family & Matrimonial
• Financially supporting your family
• Property
For further information Freephone: 0800 8 60 62 65 or visit our website www.grandparentslegalcentre.co.uk
T h e C are C ollection Bespoke, high quality home care
Aw a r d Winning Home Care i n K i r k l e e s & Calderdale
Services range from Companionship,
Domestic Support and Personal Care
through to more Complex Care. The
length of servce can be tailored from
1 hour visits to 24/7 care.
01484 521712 www.TheCareCollection.co.uk Office@TheCareCollection.co.uk
The Care Collection, Unit 25, Queens Square Business Park, Honley, HD9 6QZ
AWARD-WINNING HOME CARE BY THE CARE COLLECTION
Local resident founded The Care Collection to raise the standards of Home Care and transform the “social care crisis”
Drawing on over 20 years’ experience working across the whole care sector, Catherine Haigh founded The Care Collection to provide bespoke, high quality Home Care to the community of Kirklees and Calderdale.
Catherine explains “During my many years working in care I saw poor practice and lack of knowledge, with many care companies being run with inadequate leadership by people with no care experience. I felt compelled to help and that is how The Care Collection was born”.
The Care Collection develops and implements a model of Home Care delivery which is entirely Client-focussed, inclusive and responsive, enabling individuals of all ages to lead meaningful lives.
Continuity of staff is key to the service they offer, and they ensure their Carers have time to care through minimum 1-hour visits.
Their hourly Home Care services range from companionship, domestic support and personal care through to more complex care. The Care Collection also provides 24/7 live-in care.
The company has recently been recognised as one of the Top 20 Home Care Providers in Yorkshire on leading independent review website, homecare.co.uk. They also received a “Good” rating in all 5 areas following an inspection by The Care Quality Commission, with exceptionally positive feedback from the inspector.
To learn more, please get in touch on 01484 521712 or office@thecarecollection.co.uk or visit www.thecarecollection.co.uk.
book your flu jab now at at www.medicarechemists.co.uk book now! BOOK NOW! AT WWW.MEDICARECHEMISTS.CO.UK your local medicare pharmacy! book now! covid secure Socially Distanced Walk in or GET YOUr flu jab in a covid secure socially distanced enviroment! HONLEY - 8-10 Westgate, Huddersfield, HD9 6AA GET YOUR FLU JAB IN A COVID SECURE SOCIALLY DISTANCED ENVIRONMENT
at www.medicarechemists.co.uk book online MARSH - 140 Westbourne Road, Huddersfield, HD1 4LF Holmfirth Riverside - Riverside Shopping Centre, Holmfirth, HD9 3AZ Holmfirth Elmwood - Elmwood Health Centre, Holmfirth, HD9 3TR covid secure LOCKWOOD - Meltham Road Health Centre, Huddersfield, HD1 3UP
Socially Distanced SALENDINE NOOK - Salendine Nook Shopping Centre, Huddersfield, HD3 3XA BRADLEY - 5 Copthorne Square, Huddersfield, HD2 1SZ
Walk in or Peaches - 62 Westbourne Road, Marsh Huddersfield HD1 4Le
book online WALK-IN SERVICE ALSO AVAILABLE! WALK in service also available!
Affordable Funeral Service
Losing a loved one can be one of life's most upsetting and distressing times. We go out of our way to help ease the worries where funeral arrangements are concerned.
Not only involved with losing a loved one is the emotional upset, but it can also be a time of financial worry and strain and we not only lend a sympathetic ear but also an affordable funeral service too.
Or maybe you see not the need for an elaborate funeral and want only a simple, low key occasion without all the fuss.
Serving all areas Affordable without compromising on care. If we can help please call for an informal chat and advice
Caring Independent Funeral Service Local Caring Independent Funeral Director
Direct Cremation - £1200 Direct cremation at a fixed price inclusive of all necessary disbursements, cremation & doctors fees (no funeral service)
Low Fuss Funeral - £2050
The payment of a cremation fee
The payment of the Doctor's fees
The payment of the Minister's / Celebrant fees
The conveyance of your loved one into our
Chapel of Rest
Bespoke Funeral - £2200
Inclusive Funeral - £2500
The payment of a cremation fee
The payment of the Doctor's fees The payment of the Minister’s / Celebrant fees The conveyance of your loved one into our Chapel of Rest The provision of the York, oak veneered coffin and gold embellishments. The arranging and conducting of the funeral The provision of the hearse and necessary staff on the day of the funeral The viewing of your loved one at our traditional chapel of rest The leaving from a home address on the day of the funeral before proceeding to the crematorium
Obituary in the local newspaper Floral tribute to the value of £50
One family limousine
ALL OTHER FUNERAL REQUIREMENTS UNDERTAKEN AFFORDABLY
Springhead Funeral Service
7/9 Stainland Rd, Halifax (opposite Andy Thorntons) Tel: 01422 327 382
Bradley Funeral Service
9 Copthorne Square, Bradley, Huddersfield Tel: 01484 534 488
Pre-paid Funerals at today's prices guaranteed with Golden Leaves Funeral Plans
Please call for an information pack 39 WWW.50PLUSMAGAZINE.CO.UK or informal chat
