Next Steps
After having done your research if you decide that equity release is right for you then these are the first steps you should take:
Make sure you’re eligible for equity release. You need to be a homeowner and the youngest applicant needs to be aged at least 55 to qualify. The age criteria for home reversions schemes may be a little higher than this so it’s worth checking.
Find out the value of your home. This will help you find out how much you may be able to release. You can do this in a number of ways:
By getting an estate agent to do an appraisal of the approximate value of your property.
By talking to friends / neighbours who have recently moved in to your street / area
By looking in the local property pages at similar properties in your area
Please note that this will only give you an approximate value and is not the same as a report and valuation from a qualified surveyor.
Check how the money released may affect any state benefits you receive or your tax position. Any equity you take from your home is tax-free, however if you should invest this, which is not generally needed nowadays, any interest you receive may be taxable and may affect your tax position. A financial adviser can help you with this.
If possible talk frankly to your family as it will affect their inheritance, but do consider any undue influence from family. The decision to release equity must by yours.
Consider how releasing the money would affect your options for moving home or selling in the future for instance if you want to downsize in the future you can do this but you may have to pay a proportion of the equity you have released back to the provider, this could come from the proceeds of your sale.
Decide on the type of adviser you want to deal with. All SHIP members products are regulated which means there are strict controls via the FSA on the advice you receive. There are three broad types of advisers (they will explain this in their first meeting with you):
Providers who have their own advisers that can only advise on their own products
Advisers (tied agents) who only advise on a few products
Advisers (independent financial advisers) who can provide advice on the different products across the whole market