Equity Release, Lifetime Mortgages and Retirement Interest Only Mortgages are just a few of the different types of lending. However, they are all similar variations of one theme; to borrow money by releasing it from the value of your home.

However, there is a lot of terminology and confusion about what each loan can represent and this can make it difficult to decide what is the best option for you.

One example is equity release. A lender will release a given percentage of the value of your home depending on your age. You have to be aged 55 or older to do this and typically the older you are, the higher the percentage you can release. With this type of loan, the misconception is that you will use up all the value in your home because of the ‘compounding’ interest to the outstanding balance, which over time means interest being added to interest. However, many such loans will now allow you to make ad-hoc overpayments up to 10% of the loan balance each year without penalty, which will prevent that build up of interest, if that is what you want to do, or can afford to do.

When I approach any type of situation to advise I always focus on understanding who my client is, their needs, their preferences, and most importantly why they need to borrow the money. It can help to ensure that my clients get the right lending solution, and also help them to understand how it all works. This helps to remove any fears or concerns, especially when sometimes someone needs to borrow money, rather than actually wanting to.

Essentially these types of lending are just tools for a job, in helping you to borrow money where necessary. My role as your adviser is to help you understand the options and decide which one is the best for you. If you would like an initial chat, free of cost, then please contact me here.