As your life goes on, you will occasionally need to alter you housing situation so that it fits the living requirements of you and your family. While it may be fairly easy to make the move from a couple’s apartment to a London family home, the transition from family home to retirement accommodation is not always so easy. Thankfully there are products like the Halifax Retirement Home Plan that can be used to your advantage.
The Situation You Might Face
Not only is it difficult to say goodbye to the home in which you raised children and lived for the majority of your life, but it can also be hard to find retirement housing that falls within the parameters of your budget. Indeed, at this stage of life, many people find themselves torn between selling their beloved property and staying in it because to move out is simply too costly.
For those in this kind of situation, however, there are multiple financial schemes and plans designed specifically to help to meet the costs that retirement inevitably occurs. Whether you opt for the Halifax Retirement Home Plan or one of the many similar variations of this policy, you will find that relocating is perhaps not as difficult as you had initially assumed.
This kind of policy is designed to help to supplement the income of people surviving solely on a meagre pension. If you are retired, and you own your home, you are doubtless a candidate for equity release; this means you can take out a loan using your property as security, and this money you can use to pay for a variety of things, including retirement home care.
Facing the move from family home to retirement accommodation is not easy. Many people are unwilling to relinquish the property in which they have reared children and lived with their family; if you are not keen to sell your home outright, but you acknowledge that you need to move, you may consider taking on an equity release policy designed to bolster your income in your senior years.
How Equity Release Can Work for You
As long as you own your home there is an option out there for you. Equity release for retirees is a product that ensures you have income when you need it. Since you might be cash poor, but have plenty of value in your property you can tap into this and live better.
Yet, how they work is important. You have two types of plans: lifetime mortgages and home reversions. Home reversions will require an actual sale of your home in full or part. Since you are looking for a way not to sell your home the focus is more on the lifetime mortgage that is a loan.
It is a loan, but not traditional. You do not make any monthly payment on this loan and the principle balance remains to be paid until the end of your life or you move to that retirement home.
You will receive a tax free lump sum of cash or a drawdown account to tap when you need funds. The APR will tack onto the loan until it is paid off. In return you have funds to use. This is how simple it is.
It may come to the point you need to sell as a means of moving to a retirement home or your children may have to sell the home after you are gone. The amount you use can also limit the value your family will have from the home. These are just a couple of disadvantages, which do not outweigh the fact that you can live comfortably in retirement by tapping into your hard earned equity.
You can also protect your family’s inheritance by putting in an inheritance clause. It is possible with some lenders to stipulate a percentage of the home for inheritance. This cannot be lumped into the equity and it cannot be used if the home value drops and the loan suddenly exceeds the value.
In fact you also have a no negative equity clause that you will want to put in the agreement. This assures you that if your home value falls the total amount of the loan cannot exceed the current value and therefore your family is not responsible for paying more.
Check out the Halifax Retirement Home Plan and other equity releases to see what works best for you. Also make certain to ask an independent advisor about the specifics of these loans and find what is right for you.