Is Equity Release safe?

Releasing equity from your home is not an option that anyone should take lightly. At John Whyte Equity Release, we have many years’ professional experience in providing impartial financial advice to help you weigh up the pros and cons so you can make the right decision. As an independent equity release broker, we can help you find an equity release plan that fulfils your personal criteria and requirements.

Equity release has received a lot of publicity in the media, and unfortunately not all of it has been good. Understandably, homeowners may be worried about what it means to release equity from their homes and whether it is a safe option to take. Bear in mind that your estate and any inheritance you are intending to leave to your loved ones will be reduced as a consequence of taking out an equity release plan. Your entitlement to means-tested benefits could also be affected. You can find answers to many frequently asked questions here.

Let us now take a closer look at the safety of equity release as a financial product, and the questions you should be asking.

What safeguards are in place for equity release?

Equity release is one of the most heavily regulated financial products in the market, offering a number of key protections to keep consumers safe. Pre-regulation, this wasn’t always the case, which meant providers were able to offer unfair deals. It was these poor customer experiences that gave rise to unfavourable publicity in the past. Thankfully, those days are long gone and the integrity of the industry has been fully restored.

How is the equity release market regulated?

Whether you are considering a lifetime mortgage or a home reversion plan, there’s a wealth of consumer protection built in to the equity release market. The industry is fully regulated by the Financial Conduct Authority (FCA), meaning all equity release brokers and lenders need FCA approval in order to do business, and there are strict codes of conduct that providers must follow by law.

What is the Equity Release Council?

The UK equity release industry is represented by the Equity Release Council (ERC). All reputable equity release advisers, brokers, solicitors and lenders are members of the ERC and adhere to the trade body’s rules and guidance. These are designed to ensure that customers receive high quality products and services that are delivered with the utmost integrity and transparency.

What is the ERC’s official Statement of Principles?

 For your complete peace of mind, the ERC has a Statement of Principles that all ERC compliant equity release products must adhere to. These include the following protective measures:

  • ‘No negative equity’ guarantee, meaning you will never owe more than the value of your home
  • ‘Security of tenure’, meaning you can stay in your home for life
  • Interest rates for lifetime mortgages must be fixed, or have capped variable rates, for the life of the loan
  • Financial and legal advice is mandatory for all customers taking out an equity release plan

John Whyte is an equity release specialist with well over 20 years’ experience in financial services, and a full member of the Equity Release Council. If you would like to find out how much cash you could release from your home and which equity release plan is right for you, please do not hesitate to get in touch. Call us on 01903 890660 or simply fill out the form below.

Talk to us today about equity release by calling 01903 890660 or by the form below.

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Equity Release Sussex is a trading style of TRM Financial Ltd (FCA Ref 725622), an Appointed Representative of The Right Mortgage Ltd, which is authorised and regulated by the Financial Conduct Authority (649443). Registered in England and Wales no. 09832887. Registered Address: 70 St. Johns Close, Knowle, Solihull,
England, B93 0NH

For Independent Equity Release advice we do not charge any upfront fees however,
a fee of up to 1% of the total cash facility arranged is payable (subject to a typical minimum charge of £1,295) on completion for our service in relation to lifetime mortgage contracts plus commission from the lender.

The exact amount will depend on the complexity and work involved in your case and will be confirmed by way of a formal fee agreement.

For Independent Mortgage Advice we charge a fee of up to 1% of your mortgage amount payable (subject to a typical minimum charge of £295 payable on application & £300 on completion (£595 in total) plus commission from lender. The exact amount will depend on the complexity and work involved on your case and will be confirmed by way of a formal fee agreement.
To understand the features and risks, ask for a personalised illustration. Think carefully before securing other debts against your home.