Frequently asked questions
Your equityThe cash value remaining in your home when all outstanding secured debts have been paid. release questions answered
Q. Will I be able to stay in my own home if I take out an equity release plan?
A. Yes! We recommend plans which have this guarantee. This applies to both lifetime mortgages and reversion plans.
Q. Can I take out equity release if I’ve not finished paying off my mortgage?
A. Yes, but it will be a condition of the plan provider that the equity release is first used to repay the outstanding mortgage.
Q. What happens if I want to move house in the future?
A. You should expect to be able to move house in the future if you wish, subject to you either repaying the amount secured within your plan plus any early repayment chargesAs many equity release plans have interest rates which are fixed for life, a penalty may be levied by the lender if the loan is repaid before you and your partner either pass away or move into long-term care.Details of the early repayment charges specific to an individual plan will form part of your personalised illustration. , or transferring the plan to your new property. Each provider has specific criteria that apply concerning moving home, so you should check this when you take out a plan. As with normal mortgages you should expect to pay the costs of buying and selling your home.
Q. How much money will I be able to release?
A. The amount of money you are able to release from your property will depend upon a number of factors such as your age, property value, health and lifestyle.
Q. What will equity release cost me?
A. When you take out an equity release plan through Key, we charge a typical advice fee of only 1.65% of the total amount you release. Plus you are likely to incur costs for surveyor’s fees and solicitor’s fees, although some providers may make a full or partial contribution.
Q. Will I have any monthly repayments to make?
A. Unless you choose to take out an interest payment plan, there will be nothing to pay towards your equity release until you pass away or move into long-term care. The total amount owing to the provider will then be paid.
Q. Will I be able to guarantee an inheritance for my loved ones?
A. Yes, this is possible. Make sure your adviser is aware that this is one of your wishes and select plans with this guarantee.
Q. Will my family end up in debt because of my equity release plan?
A. No as we recommend plans which come with a no negative equity guarantee.
Q. Should I discuss my plans to take out equity release with my family?
A. It is important to involve your family in any financial decision which will reduce the value of the inheritance left to them, but we find that most families are incredibly supportive of their loved ones’ decision to take out an equity release plan to boost their retirement income.
We actively encourage each of our customers to invite as many family members or friends that they wish to their FREE equity release consultationA meeting with your equity release adviser, either in the comfort of your own home or over the phone. It is your opportunity to learn more about equity release, enabling you to make a fully informed decision about whether it’s right for you. , enabling everyone to get a full picture of equity release before any decisions are made.
Q. What will happen with my equity release if I move into long-term care?
A. If your equity release plan was taken out jointly with your partner, they would be able to continue living in the property without impacting your means test for long-term care fees.
If your equity release plan is solely in your name, your home would be sold and the equity release provider would receive the money owing to them from the proceeds.
Q. What will happen regarding my equity release when I pass away?
A. If you have a joint plan and your partner survives you, then your equity release will not be affected and they will be able to remain in your home for as long as they choose.
If your equity release plan is in your name only, your house will be sold and the equity release provider will take its money from the sale proceeds. The remainder will go to your estateThe value of your assets at the time of your death, after all debts and charges have been paid. and will be distributed in line with your wishes, as set out in your Will.
Q. Is equity release safe?
A. Equity release advice is fully regulated by the Financial Conduct Authority (FCA), ensuring all advisers follow strict rules and guidelines with the FCA keeping a record of all approved firms.
Did you know?
We recommend plans that guarantee:
- You will never go into negative equity.
- That you can stay in your home.
- That you can move if you choose – subject to provider criteria.
This is an equity release plan. To understand the features and risks as for a personalised illustrationThis is a document which sets out the details of your recommended plan as they apply to you, alongside the associated terms and conditions. .
If you are considering equity release we recommend that you read through is it right for you? carefully.