Interest rates on equity release plans have dropped in recent years, so if you already have an equity release plan in place, you could possibly benefit from swapping your plan to a more competitive one.
By swapping plans, you could considerably reduce the amount of interest that accumulates in the future. The table below illustrates the difference in the highest lifetime mortgage interest rate from 2003 compared to the lowest interest rate available in 2012.
| £50,000 borrowed |
Lifetime Mortgage interest rate |
Total amount owing after | ||
|---|---|---|---|---|
| 5 years | 10 years | 15 years | ||
| 2003 | 7.28% | £71,050 | £100,962 | £143,467 |
| 2012 | 5.50% | £65,348 |
£85,407 |
£111,624 |
| Save by switching | £5,702 | £15,555 | £31,843 | |
This table is for illustration purposes only. The actual rate will depend on your circumstances.
Even if your scheme has early repayment charges, changing to an equity release scheme with a lower interest rate could prove more financially beneficial than sticking with your current plan. We can find out whether it would be wise for you to switch your lifetime mortgage by comparing interest on your old plan against interest on a new plan, plus early repayment charges and all associated costs or fees for moving to the new plan.
If you swap schemes, our dedicated team will take the hassle out of the transaction by looking after it for you from start to finish, ensuring everything goes ahead smoothly.
Apply for a top up
If it’s been five years or more since you completed an equity release scheme you could be eligible to apply for a top up to boost your funds again. One of our independent equity release advisers will be able to tell you over the phone whether you could top up and will handle all of the paperwork and application on your behalf. We’ll also talk to your provider and solicitor to try to speed things along so that you receive your cash as soon as possible.
There’s nothing to lose by asking Key for a free review of your existing scheme, even if it’s just to get peace of mind that you do have the best scheme for you! Call our dedicated switching team today on 0800 915 4717.
This is an equity release plan. To understand the features and risks ask for a personalised illustration.
