Equity release for older people

There is a good summary of the options in the current edition of Consumer Choice

Lifetime mortgages
Not sure how the 4.5% variable rate changes.
You have to pay your own legal costs as well

Sixty Plus Finance Home Loan Reversion
Example:
Notes
Having a large lump-sum will reduce means-tested Social Welfare entitlements

More details: www.sixyplusfinance.ie

Alternatives
Borrow from a family member, especially if it's just a small amount
Trade down
Do a home loan reversion with a family member

Brendan

Can you explain what you mean by "home loan reversion" and how it might work in practice. My in-laws are in a position where they would like to raise about €60,000 and their home is their only significant asset.

Thanks

S

Cheers, Thanks.

There is a very useful Home Loan Reversion Calculator on the Seniors Money [broken link removed]

You put in your age and the value of your property, and they tell you how much they will lend you.

You then put in the amount you wish to borrow and your assumption of house price inflation.

They calculate how much equity you will have in your property at various ages.

For example

Age now: 70
Property value: €500k
Maximum loan amount: €125k
Actual amount borrowed : €98,500 ( €100k - €1,500 set up fee)
Assumed interest rate: 4.9% ( the current rate)
Assumed property inflation: 2%
Equity remaining at age 90: €477k

It would be handy if the €477k was recalculated in today's money.

Has anyone used one of these recently? Are they still available? Are the rates still as quoted above?

Brendan

Their Home Page states they are not currently accepting new applications, contact them to be placed on a waiting list.

I enquired about the length of this waiting list recently on behalf of a relative, this is the reply I got;

Dear XXXXXXXXXXXXXXXXX,

Unfortunately we can’t give you any indication of when or even if we will be in a position to recommence lending.
It really depends on the availability of credit on the international financial markets and of course the cost of that credit.

I'm sorry we are unable to provide you with even an indication of a time frame. We are continuing to monitor the situation and if anything changes we will update our website accordingly.

Kind regards,