Equity Release in Spain. Lifetime Mortgages and Home Reversion Plans
Equity release for expats has become increasingly difficult to obtain in recent years. The pool of UK lenders has reduced significantly throughout the credit crunch from what was an initial 21 down to just 9 today - some of those that have exited the market include Prudential; Coventry Building Society and Newcastle Building Society - whilst others have suspended any new business until funding markets return to some form of normality
 
 
UK lenders will not, at present, accept Spanish property as any form of collateral. The issues concerning illegal builds; corrupt mayors; thousands of empty units and unfinished shells; falling property prices; demolition orders etc. have caused the UK lenders to reassess their lending criteria.
 
To continue to provide equity release in the expat market our partners have worked out a complete package involving a UK property as collateral. Features include :


  • Plans available for applicants starting at aged 55 years or over
  • A range of both Lifetime Mortgages as well as Home Reversion Plans
  • No monthly payments on any plan
  • Single Cash Lump-Sum/Income Drawdown/and Home Reversion options
  • All plans provided by members of Safe Home Income Plans (SHIP)
  • “No Negative Equity Guarantee” on all Lifetime Mortgages
  • Legally binding agreement with “Guaranteed Occupancy” on all Home Reversion Plans
  • All equity release plan providers are fully regulated by the UK’s Financial Services Authority
  • A comprehensive panel of Solicitor’s that are experienced in dealing with Equity
  • Release plans that are independent and regulated by the UK’s Law Society

 
Equity Release in the UK is very highly regulated by the FSA and can only be dealt with via FSA Regulated and fully qualified advisers who hold the CeRER equity release qualification. G.A.D offer a complete service including fully regulated advice, guidance from start to completion, and money transfer facillities to move any released capital to your chosen location and currency.
 
 
 
Lifetime Mortgage Spain
 A lifetime mortgage is a form of equity release scheme where a loan is secured against a property to provide you a monthly income to spend as you wish.

Usually interest is added to the lifetime mortgage loan throughout the lifetime, accruing at a fixed or variable rate. The loan plus interest is eventually paid back when the owner(s) pass away. At that point descendants would normally inherit the home and the debt, and they will be able to liquidate it by selling the home, or by taking out a new mortgage. Since it is a loan, tax is not incurred on the monthly income.

Key Features/Benefits :
 
  • It is a  guaranteed monthly income for life while retaining ownership and use of your home.
  • The arrangement can be cancelled at any time.
  • Monthly income can be for life or for an agreed period of time.
  • Favourable taxation.
  • Available on Spanish Property
 
Equity Release Pros and Cons
Advantages and disadvantages of Equity Release

Advantages:

  • Equity release will make cash available either as lump sum or regular income.
  • Products are available where no payments are required until the home is sold
  • Client remains in the home for the rest of his/her life
  • You can usually still move home (subject to restrictions).

Disadvantages:

  • Equity release reduces the value of the estate for beneficiaries
  • Equity release products involve borrowing against or selling all or part of the home.
  • There may be more suitable methods of raising the funds you need.
  • Equity release schemes may work out more expensive in the long term than downsizing to a smaller property.

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