How much will it cost me?
The cost of equity release falls into two areas:
- The initial fees to arrange and put the equity release plan in place
- The interest charged on the loan
Remember the loan and the equity release interest will only be paid off when you die or move into care but as this will affect your family’s inheritance, it is important to understand how much this could be.
What is the initial cost of equity release?
According to the Equity Release Council, the average cost of arranging equity release is between £2,000 to £3,000 and consists of the following payments:
- Administration and application fees (depending on the lender)
- House valuation
- Solicitors fees for providing independent legal advice
The point to remember here is that by talking to an industry expert like Age Partnership, your initial advice is completely free of charge; you only pay if you decide to go ahead.
The amount charged is typically 1.95% of the cash sum you release or a minimum fee of £1,395, which is only payable once your equity release plan is in place.
So the benefits of choosing a company like Age Partnership are as follows:
- They compare the whole of the equity release market , so they’re not tied to any particular mortgage provider
- They have arranged special rates with lenders that you may not be able to get elsewhere
- They work on your behalf agreeing reduced set-up costs with lenders and can even secure cash back payments with some providers once your equity release plan is in place
- Their initial advice be it over the phone or face to face is completely free
- Your Age Partnership advisor is there to guide you through the whole process
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Should I downsize or choose equity release?