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1. Your Guide to
Equity Release
How to access the Equity in
your property in later life

2. Looking for ways to release
some tax-free funds in later life?
If you’re aged 55 or older, you may be considering releasing some
cash from the value of your home
Find out if equity release is right for you
Talk to us today to discuss your options – please contact us.
Call Missing Element Equity Release on
01773 856 355 or email
hello@missingelementequityrelease.co.uk to
request a call back.
Visit our website www.missingelementequityrelease.co.uk
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR PROPERTY MAY BE REPOSSESSED IF
YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
EQUITY RELEASE REFERS TO HOME REVERSION PLANS AND LIFETIME MORTGAGES. TO UNDERSTAND THE FEATURES AND
RISKS ASK FOR A PERSONALISED ILLUSTRATION.
EQUITY RELEASE REQUIRES PAYING OFF ANY OUTSTANDING MORTGAGE. EQUITY RELEASED, PLUS ACCRUED
INTEREST, TO BE REPAID UPON DEATH OR MOVING INTO LONG-TERM CARE. EQUITY RELEASE WILL AFFECT THE
AMOUNT OF INHERITANCE YOU CAN LEAVE AND MAY AFFECT YOUR ENTITLEMENT TO MEANS-TESTED BENEFITS NOW
OR IN THE FUTURE.
CHECK THAT THIS MORTGAGE WILL MEET YOUR NEEDS IF YOU WANT TO MOVE OR SELL YOUR HOME OR YOU WANT
YOUR FAMILY TO INHERIT IT.
IF YOU ARE IN ANY DOUBT, SEEK PROFESSIONAL FINANCIAL ADVICE.
Published for Missing Element Equity Release, a trading style of Missing Element Mortgage Services FCA 411871
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Although endeavours have been made to provide accurate and timely information, there can be no guarantee that such
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situation. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of the content.
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Missing Element Mortgage Services. Unauthorised duplication or distribution is strictly forbidden.
04 How to access tax-free property wealth in later life
06 What is equity release?
08 Why has equity release come about?
10 What are some of the reasons people turn to equity release?
12 What is a Lifetime Mortgage?
14 What is a Home Reversion Plan?
16 What is a ‘no negative equity’ guarantee?
17 Is equity release safe?
18 Is it necessary to have a Will in place?
19 Should I consider appointing a Lasting Power of Attorney (LPA)?
20 Can I switch my existing equity release plan to another provider?
21 Is borrowing in later life right for you?
22 What other things should I consider before proceeding with equity release?
Contents

3. Your Complete Guide to Equity Release
How to access Equity tied up in your home in later life.
In this condensed guide about equity
release, we will explore what it is, why it’s
relevant and if it could be for you so that
you can make decisions regarding equity
release in your life.
Most UK homeowners will agree that their
home is the biggest asset they have. Not
only is it the biggest investment, but it can
also hold the richest potential for releasing
equity. Over the last decade, homeowners
have been putting that equity to work as the
cost-of-living increases.
Fundamentally, it’s all to do with retirement.
We are living longer and expect to continue
with the standard of living that we have
so far achieved. Day-to-day expenses, which are seemingly always on
the rise, need to be covered as well as those little extras that make life
worthwhile.
Retirement is no longer a simple affair. With the goal posts to that ‘golden
feet up’ time being continually moved; retirement can be a period of
uncertainty. Security into older age and maintaining a certain standard of
living can present difficulties and this is where equity release can be a gift.
While offering people a chance to meet their financial goals without adding
uncertain or unreliable debt to their financial profile, releasing equity can
also be used to address additional financial pressures.
Seeking professional, trustworthy advice must be the first step before
deciding on whether equity release could be for you. Releasing equity is
a personal decision and not always right for every household, however,
reliable financial support with the bonus of being able to stay in the home
that you love is most definitely worth exploring.
Is equity release in your future? Regardless of what step of the process
you’re on, welcome to your go-to guide, helping you make your decision
with the right support.
Paul Neal
Equity Release Broker at
Missing Element Equity Release
“Staying in your home not
only means you get to
retire in the house you
love, but you also won’t
need to deal with the
stress and expense that
comes with moving”

4. Equity Release –
Explained
In short, if you are over 55 you could be eligible to release cash from your
home if it’s worth more than £70,000. Remember, the doors to this club
only open when you hit 55, and as you’d expect, there are terms and
conditions. We will get to that later.
NB: - your home must be worth a minimum amount of £70, 000, be your
primary residence in the UK and where you spend at least 6 months per
year.
As with most things in life there is never one simple choice but thankfully
for the purposes of equity release there are only two.
Firstly, there is the lifetime mortgage option. Essentially a long-term loan
secured against your home. It allows cash to be borrowed against its
calculated value, before being repaid at an agreed date in the future. This
is often done after you, the homeowner, moves into long-term care for end-
of-life services or die. Cheery, I know. On the plus side, your home belongs
entirely to you until this time.
Secondly, we have the home revision plan, whereby a third-party
purchases part of, or all, of your home from you. They will provide you with
a cash payment of the agreed-upon amount. There is no requirement to
vacate your home, you do not pay any kind of rent, but you no longer own
the property in the formal sense.
Now, while you digest that please note that there is a way to shield some
of that cash – otherwise known as inheritance. The term we use is ‘ring-
fencing’ and allows a certain amount of money to be protected.
Talk to a specialist to see which of these options is right for you. They’ll
also be able to help you get a feel for other criteria!
For home reversion plans we act as introducers only.

5. Modern times often come with lower retirement ages and upon retirement,
homeowners can find that they have high value assets but are lacking the
regular inflow of cash required to sustain a decent life. This makes many
consider freeing up the equity in their home.
Instead of dipping into that pension pot earlier than planned, home equity
release allows you to gain access to the available cash in your home, if
you have sufficient capital of course.
Essentially, equity release brings to the table the ability to access cash
without the need to move house.
People – we are
living longer!

6. Why do people use
equity release?
There are endless reasons why people see equity release as a good
choice. The more obvious are like those discussed earlier: - boosting
income after retirement, improving daily quality of life, etc.
Perhaps the biggest and most popular reason homeowners turn to equity
release is that there are ABSOLUTELY NO restrictions on what you can do
with it. Unlike traditional loans, equity release is a tax-free, lump sum cash
payment and can be put to work wherever and however you choose. Since
most folks don’t have that financial freedom at any other point in their lives,
this is understandably appealing.
Having cash taken responsibly from the established value of their home
can make a real difference in a homeowner’s quality of life, as well as their
overall stress level. Things like repaying debt, repairs and renovations,
or maybe buying a new car or going on holiday are all examples of how
people choose to use the cash they release.
While it isn’t always right for every individual, it is a popular and low-risk
choice for daily living as well as once-in-a-lifetime opportunities.
A huge benefit of releasing money from your own home is that it is, indeed,
your home. If there is something, or lots of things you’d like to do before
the finality that death brings, then this could be a great option. It is after
all, guilt-free, non-borrowed cash that you have worked hard for. Why
shouldn’t you enjoy some, even all of it!

7. As the name implies, this is technically considered a kind of mortgage.
An agreement involving you, your partner and the lender who purchases
the house from you. Once you and your partner pass away or move
permanently into long-term care, the house would be sold, and the
mortgage repaid to the lender.
A lifetime mortgage doesn’t have monthly payments like a traditional
one, although you can choose to make monthly payments to bring down
the overall interest, which accrues every month just like it would on a
traditional mortgage.
Remember, this is a loan that is secured against your home and one which
will be repaid in full following the sale of the property.
This option provides either the option of taking the cash all at once or
receiving it over several smaller lump sums. Discussing which option
would best suit your needs is something to be taken up with your lender,
depending on your intentions regarding the cash.
Some lenders will allow you to change the amount you receive. This is
especially helpful if you opt to borrow a smaller amount upfront and then
decide later that you’d like to borrow more.
Many people wish to financially help their children or grandchildren
when they die. Some lenders do allow for ‘ring-fencing’ – which enables
borrowers to hold back some of the value of the property to use that as
inheritance. Ensure that this is something that you discuss with your broker
at the point of application.
The goal of a lifetime mortgage is to offer flexibility to the homeowner,
ensuring that each person is fully in control of how they are borrowing
money and in how much they decide to borrow against their home.
Lifetime Mortgage -
Explained

8. Home Reversion
Plan - Explained
This is a bit more of a direct approach to equity release. In this case, you
would sell part or all your home to the lender and receive cash as a result.
The other main difference to this kind of equity release is that it only
implies your ownership of the home. If you have someone else that owns
the home with you, such as a child or another family member, they still hold
onto their share of the home in full. When it is sold after you’ve moved
into long-term care or passed away, they will get their full amount from the
proceed of the sale.
One of the main benefits of this is that you will know exactly how much is
going to have to be repaid upon the sale of the home. Since it’s the same
cash value from one year to the next, it offers peace of mind to those who
are apprehensive about the housing market and its fluctuations. This also
means that you can assign what’s left of the house value into inheritance if
you wish to do so.
One factor to keep in mind is that releasing cash value in this way, will
counts as income. While it isn’t taxable, the increase in your yearly income
may disqualify you from any means-tested benefits. You’ll want to talk
about this in detail with any potential provider that you consider so that
you’re aware of any ramifications
For home reversion plans we act as introducers only.

9. A ‘No Negative Equity’
guarantee – Explained
Seriously – Is Equity Release Safe?
This is a guarantee that offers peace of mind to those who choose a lifetime
mortgage as their choice for home equity release. This means that you and
your estate will be protected from having to pay more than what you took out
when your home is sold. This includes solicitor and agent fees, closing costs,
and other additions that can add up very quickly. A lifetime mortgage must
come with a ‘no negative equity’ guarantee.
It is regulated by the Financial Conduct Authority (FCA) and overseen by the
Equity Release Council (ERC). There are numerous rules and safeguards in
place to ensure that you stay in total control over your home, still retaining the
flexibility to move home in the future.
You will be able to stay in your home for the remainder of your life or until you
move into long-term, end-of-life care, provided you abide by the terms and
conditions previously agreed to in the lifetime loan.
Lifetime mortgages are FCA and ERC-governed, which ensures that the
homeowner can walk away without incurring more debt than they planned or
leaving their estate to foot the bill.
The interest rate is often fixed for peace of mind. In situations where you
choose a variable interest rate, there will be a capped limit that is fixed. This
limit will be applied for the lifetime of the loan for your own protection.

10. Is it necessary to have a
Will in place?
Should I consider appointing a
Lasting Power of Attorney (LPA)?
Making a Will helps to protect your loved ones after you die, and
ensures your estate is dealt with in the way you choose.
If you are considering equity release it is important to have a Will
in place or revisit the terms of your current Will.
A Lasting Power of Attorney (LPA) is a way of giving someone you trust,
your attorney, the legal authority to make decisions on your behalf if you lose
the mental capacity to do so in the future, or if you no longer want to make
decisions for yourself.
While having a LPA is not required by law, it is highly desired and should be
included in your equity release planning process.
The FCA does not regulate wills, power of attorney and some forms of estate
planning and we act as introducers for these services.

11. Can I switch my existing
equity release plan to
another provider?
Is borrowing in later life right for you?
Yes, some older schemes charge higher rates of interest than are
currently available in today’s market. It is always worth looking to
see if you can reduce costs. However, this needs to be done after
immense care has been taken as it may not be feasible.
The terms and conditions on a newer plan may appear more
suitable but you need to be mindful of the costs involved.
Borrowing in later life could impact on the inheritance you leave
and any state benefits or local authority grants you receive.
These are some of the alternative options to equity release that
might work better for you:
• Use available savings
• Move and downsize to a smaller home
• Ask for help from family members
• Check if you are eligible for any state benefits
• Enquire if you qualify for a local authority grant
• Apply for a personal loan or credit card
Before deciding whether to borrow, it’s a good idea to speak with family
members or trusted friends. They could give you support or suggest other
ways to raise the money you need.

12. What other things should
I consider before
proceeding with equity
release?
You should consider these factors before deciding if equity
release is right for you.
Impact on inheritance
Tax and inheritance, or some state benefits, may be affected. A lump sum
is considered as capital and a regular payment is considered as income.
This may impact on tax and reduce the inheritance you leave.
Claiming benefits
If you are considering taking out a Lifetime Mortgage, this could affect your
ability to claim means-tested benefits, including support for long-term care.
Disability benefits, such as
Attendance Allowance, are not affected.
Costs involved
A Lifetime Mortgage can be more expensive than a standard mortgage –
for many Lifetime Mortgages, the interest is added to the amount you owe.
You’ll have to pay interest on the interest (compound).
Home Reversion Plan
With a Home Reversion Plan, you will usually get less than the full market
value of your home. You sell part or all of your property to a plan provider,
and they will pay you a tax free lump sum in return.
This lump sum won’t be for the market value of your home because the
provider is giving you the right to live there rent-free for the remainder of
your life.
When you die, your property will be sold and some or all of its value will
go to the company that sold you the reversion plan, depending on the
percentage they bought.
Tax and inheritance, or some state benefits, may be affected.
A lump sum is considered as capital and a regular payment is considered
as income. This may impact on tax and reduce the inheritance you leave.

13. How much tax-free cash could you
release from your property?
Over 55, require cash or looking for a more stable
retirement, and own your home?
The steps you take today could help you enjoy financial
independence, let us show you what we’re talking about.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR
PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR
MORTGAGE.
EQUITY RELEASE REFERS TO HOME REVERSION PLANS AND LIFETIME MORTGAGES. TO
UNDERSTAND THE FEATURES AND RISKS ASK FOR A PERSONALISED ILLUSTRATION.
EQUITY RELEASE REQUIRES PAYING OFF ANY OUTSTANDING MORTGAGE. EQUITY RELEASED,
PLUS ACCRUED INTEREST, TO BE REPAID UPON DEATH OR MOVING INTO LONG-TERM CARE.
EQUITY RELEASE WILL AFFECT THE AMOUNT OF INHERITANCE YOU CAN LEAVE AND MAY
AFFECT YOUR ENTITLEMENT TO MEANS-TESTED BENEFITS NOW OR IN THE FUTURE.
CHECK THAT THIS MORTGAGE WILL MEET YOUR NEEDS IF YOU WANT TO MOVE OR SELL
YOUR HOME OR YOU WANT YOUR FAMILY TO INHERIT IT.
THE FCA DOES NOT REGULATE SOME FORMS OF TAX PLANNING AND WE ACT AS
INTRODUCERS FOR IT.
IF YOU ARE IN ANY DOUBT, SEEK PROFESSIONAL FINANCIAL ADVICE.
To find out how we could help you -
please contact us.
Call Missing Element Equity Release on
01773 856 355 or email
hello@missingelementequityrelease.co.uk
to request a call back.
Visit our website
www.missingelementequityrelease.co.uk