It’s the start of a new year – is it a good time to get moving on your equity release plans? Mark Gregory of Equity Release Supermarket explains how current economic conditions are impacting later life mortgage options
The QuestionMy husband and I own a three-bedroom home in Lincolnshire and we have paid off our mortgage. We suspect its value is around the £360,000 region or thereabouts.
We hope to release some equity in 2024 to fund the landscaping of our garden and installation of a new kitchen and a bathroom.
Please could you advise on the situation with interest rates on equity release, if they are affected by the Bank of England base rate and what you expect might happen to them in 2024. We may hold off on our plans if rates are too high.
Thank you for your question, and it is fair to say due to the current economic conditions, interest rates are a big topic for discussion. Like savings and investment interest rates, and conventional mortgages, Lifetime mortgages and Retirement Interest only Mortgage fixed rates have increased over the last 12 months.
Although I am not an economist, many expert commentators have predicted that interest rates have peaked, and with this in mind, we have seen some recent reductions in interest rates with both Lifetime mortgages and Retirement Interest only Mortgages.
Furthermore, flexible Lifetime mortgages and Retirement Mortgages have fixed interest rates for the entire term of the plan, and this can give customers peace of mind.
Lifetime mortgages allow customers to have a choice of making no payments or if they want to make payments, they can be partial capital or interest payments to manage the accumulation of compounding interest.
Retirement Interest only Mortgages can have a fixed rate of interest for two, five or 10 years, or the full term, so the choice is yours. Although you have not provided your age, I can confirm that the minimum age for both a Lifetime mortgage and Retirement Interest Mortgage is aged 50 and the minimum property value must be £70,000.
Another point to note is that the fixed interest rate on a Lifetime mortgage can be dependent on the amount of capital you require, and you have not made it clear how much you would like to raise for your objectives. Therefore, as part of your initial research you have several options including you could simply telephone the Equity Release Supermarket freephone telephone number 0800 088 5874, and one of our friendly expert advisers will discuss your options and provide you with personalised interest rates based on your personal capital requirements.
Secondly, you can contact them through our ‘livechat’ facility via the Equity Release Supermarket website, or alternatively use the unique smartER research tool on the Equity Release Supermarket website, to understand what you may be entitled to borrow with ‘live’ interest rates
Mark Gregory, founder and CEO of Equity Release Supermarket, is here to answer your questions. Mark is an adviser himself with over 20 years equity release experience.
He launched Equity Release Supermarket 10 years ago and it has grown to become one of the UK’s leading equity release specialists.
Email kate.saines@emap.com to ask Mark a question
