It’s no secret that using an Equity Release scheme will make a dent in your children’s inheritance. Obviously if you don’t have any children this may not be of much concern to you. If you do have children, or you have people you care about that you would like to leave some of your estate to when you pass away, then this will be relevant to you.

In a nutshell, using an Equity Release scheme will mean that when you die (or both in a couple), some of your estate will be used up. How this works depends on the type of scheme you take out. With a Home Reversion scheme, you are actually selling part or all of your home. Therefore when you die and after the property has been sold, part of the proceeds will legally belong to the lender. If all of the property was sold in the first instance then the client would actually be a tenant of the lender, therefore the property would, in this instance belong fully to the lender. With a Lifetime mortgage scheme you would have borrowed the money like a normal mortgage, the main difference being you usually don’t pay any interest until you die. Therefore with this scheme, when you die, the executors of your estate will need to clear the debt before allocating monies as per your will, or the laws of intestacy (if you haven’t made a will please get in touch with us).

So, why would you bother with an Equity Release Scheme if it was going to effect what you could leave behind to your loved ones? Well, we can safely say that the vast majority of children or beneficiaries in general, do not mind receiving less in an inheritance. Most of the family members we talk to are very passionate about their parents or grandparents enjoying their twilight years. Many people in this country are what we call, “cash-poor, property rich”. This means they may have a nice house, but very little money in the bank. By taking an Equity Release scheme with us you can actually use some of that money locked up in your home, and start enjoying life! If you would like to receive a calculation of what you could release from your home, please click here to use our Equity Release Calculator.

Part of our process is to talk to family members about the effect on any inheritance. We want to make sure that your family are fully aware of the implications. Ofcourse if you would rather us not talk to them, we wont. That’s your decision. But we strongly recommend it and will discuss it further in our first consultation with you.

So yes, taking an Equity Release Scheme will effect the end value of your estate. But the benefits of this sort of lending far outweigh any downsides. It can mean the difference between being miserable and happy.

If you would like to discuss this further with us, please do not hesitate to call us on the number above, or submit a request for a callback by clicking here.

Tags: calculator, Elderly, equity release, inheritance, Lifetime Mortgages, property rich, twilight years

This entry was posted on Thursday, March 11th, 2010 at 11:57 and is filed under Industry Topics. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.