Latest Cut In Base Rate Encourages Equity Release Rethink
Andrew Braithwaite
January 26, 2009
In 2008 in the middle of an economic slow down, we saw a considerable drop in house prices, this made equity release less popular as home owners became glowingly concerned about the financial crisis. Could 2009 bring an increase in equity release as the interest rate plummets?
As world finances are in turmoil and confidence is at a all time low the UK housing market was hit by the recession. As property wasn't selling and lenders got into difficulty cutting the interest rate was the decision which was made by the government. This has lead to new options for the average home owner. Pensioners especially are beginning to feel that releasing capital from their houses is the next best option. As we enter 2009 it seems the problem is still far from resolved.
A growing attitude which many pensioners are adopting from the troubled economy is why they should be living in difficulty when they could release equity and benefit the rest of their lives in comfort.
Although the interest rate has caused a relief to many people, anyone with savings will feel the drop in interest from banks and building societies. There are however always alternatives and one or two banks are still offering reasonable rates.
Releasing equity allows a person to unlock money from a property whilst continuing to live there, once the person(s) died it would then be passed to the equity provider who would be entitled to either a percentage or total of the house, depending upon what equity plan was drawn up.
The latest cut in base rate brings up many questions to how the equity release providers should calculate their latest interest rate. This will ultimately effect the amount of new equity plans being drawn up in the future.
Find more information on equity release mortgages at http://www.responsibleequityrelease.co.uk/
As world finances are in turmoil and confidence is at a all time low the UK housing market was hit by the recession. As property wasn't selling and lenders got into difficulty cutting the interest rate was the decision which was made by the government. This has lead to new options for the average home owner. Pensioners especially are beginning to feel that releasing capital from their houses is the next best option. As we enter 2009 it seems the problem is still far from resolved.
A growing attitude which many pensioners are adopting from the troubled economy is why they should be living in difficulty when they could release equity and benefit the rest of their lives in comfort.
Although the interest rate has caused a relief to many people, anyone with savings will feel the drop in interest from banks and building societies. There are however always alternatives and one or two banks are still offering reasonable rates.
Releasing equity allows a person to unlock money from a property whilst continuing to live there, once the person(s) died it would then be passed to the equity provider who would be entitled to either a percentage or total of the house, depending upon what equity plan was drawn up.
The latest cut in base rate brings up many questions to how the equity release providers should calculate their latest interest rate. This will ultimately effect the amount of new equity plans being drawn up in the future.
Find more information on equity release mortgages at http://www.responsibleequityrelease.co.uk/
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