Halifax Retirement Plan May Be Suitable For Many Older Home-owners

By Author: Robert Deville
Total Articles: 4717
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Halifax retirement plan offer a method through which older homeowners can raise some money secured on the equity which they have tied up in their property. These schemes can either be lifetime mortgages, or home reversion plans. The FSA (Financial Services Authority) are the regulator for this financial market. A fact sheet discussing the options can be obtained from the FSA, either by downloading from their website, or by telephone request. As well as covering how these schemes work, it also explains why the schemes may not be ideal for all people.

Equity release may be considered by older homeowners, typically those aged 55 and above. Eligibility usually depends on having outright ownership of the property, that is there must be no outstanding mortgage or any other loan secured on the property. If the homeowner takes up one of the schemes they will be able to release some of the value tied up in the property, and enjoy the use of that money during the remainder of their lifetime.

Halifax retirement plan can be divided into two main types: lifetime mortgages, and home reversion plans. In a lifetime mortgage, a ...
... loan is taken, and secured against the value of the property. There are a number of different types of these mortgages: roll-up mortgages, interest only mortgages, fixed repayment mortgages, and home income plans.

Lifetime mortgages are repaid when the person stops living in their home. This may be at their death, or in some cases when they enter long-term care.

When a homeowner takes out a lifetime mortgage, they remain as the full legal owner of the home. This is different to a home reversion plan, where the ownership of the home (or partial ownership) is transferred. Home reversion plans usually involve a reversion company, who may purchase the property themselves, or may arrange for its sale to an investor.

The original property owner will be given a long-term lease, which will allow them to remain living there for the rest of their life (or for however long they wish to do so). The minimum age at which a home reversion plan can be taken is often rather higher than the minimum age for a lifetime mortgage.

Both lifetime mortgages and home reversion plans are regulated by the FSA (Financial Services Authority). The FSA provide a fact sheet discussing the options, and as well as covering how the schemes work, it also explains why Halifax retirement plan may not be ideal for all people. The regulations by which the schemes are sold ensure that providers always take into account the personal circumstances of their customers, and only sell products which are appropriate to their requirements.

The Key Facts document, personalized for each customer, is in a standard format, allowing customers to easily compare the products on offer from different providers. Providers will also explain why equity release may not be the ideal solution for some people. It will reduce the amount of money which the homeowner can leave in his estate after death, and it may change the owner's eligibility for means-tested state welfare benefits.
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Retirement Solutions can arrange an initial consultation free of charge to discuss the Halifax retirement plan.