Kevin Watling, mortgage protection and equity release specialist for Molyneux Associates:
Those considering equity release, or those who may have taken out plans, will probably have seen the name or the logo on the paperwork relating to their release at some stage, but what is it and what does it do?
Since its establishment around 30 years ago, replacing the old SHIP body, the Equity Release Council has established a set of values, safeguards and standards for providers and advisers - Molyneux included - to adhere to be able to maintain their membership of the council.
To quote from their website: “These standards and safeguards have allowed the sector to grow, giving financial advisers and their customers confidence in the products, dispelling myths about equity release, and educating the public about the potential to access the wealth in their home for a variety of uses.”
To quote the chairman of the Equity Release Council: ”The equity release market is showing signs of stability and durability as the option to access property wealth opens doors for thousands of people to pursue their financial goals.”
In terms of numbers, let`s just have a quick look at some of the details from the council review of the second quarter of 2021.
Over-55 homeowners accessed £1.17 billion of property wealth in the second quarter of 2021.
This was up 67 per cent from the same period in last year`s lockdown as discussed in last month`s column.
A total of 20,270 new and returning customers were served between April and June as the market edged back towards pre-pandemic levels.
This compares with an average of 21,036 customers per quarter in 2018 and 2019.
Drawdown lifetime mortgages remained the most popular option with new customers - 55 per cent - while 45 per cent opted for a lump sum lifetime mortgage.
The average first instalment of a new drawdown lifetime mortgage was £86, 349, with £129,558 as the average new lump sum lifetime mortgage.
Hopefully, this will give an idea of the role of the council and the scale of release plans being taken out.
If you are considering equity release or perhaps have any queries on an existing scheme please get in touch - call 01803 659592, email email@example.com or call in at Molyneux Associates in Fore Street, St Marychurch.
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