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Submitted by: Mable William
The Halifax equity release scheme or as it is officially called by the Halifax, Retirement Home Plan is an interest only mortgage that is available to retirement people. With an interest only mortgage the outstanding balance always remains the same throughout and you make monthly payments of interest to the lender.
With traditional roll-up equity release you do not make any repayments of interest but the interest is being rolled up, meaning the outstanding loan is growing all the time. Typically, with current interest rates the loan will double every 12 years or so, this means that if you borrowed ?10,000 in 12 year’s time you would owe ?20,000.
For those retirees that can afford the monthly repayments from their pensions or state benefits then the Halifax equity release plan makes perfect sense. Oddly, the plan is not available from the Halifax themselves; you have to seek advice from a specialist equity release broker. Getting advice is vital for this type of plan as the consequences of getting it wrong can be very costly and maybe cannot be put right during your lifetime.
Does Halifax equity release plan require a repayment vehicle?
The simple answer to this is NO it does not. As the Halifax equity release plan is an interest only mortgage for pensioners, no form of repayment is required. This is one of the unique features of the plan.
Your individual mortgage with the Halifax equity release scheme is allocated a term of 40 years, this should be ample to run for the rest of your life. In contrast to traditional interest only mortgages where the term allocated is generally a maximum of 25 years, the 40 years allocated should mean you will die prior to the term ending.
Can I pay off the Halifax equity release mortgage early?
Yes you can. You will, however, need to check that you do not have any early exit charges on the rate that you chose.
The Halifax equity release scheme or as it is officially called by the Halifax, Retirement Home Plan is an interest only mortgage that is available to retirement people. With an interest only mortgage the outstanding balance always remains the same throughout and you make monthly payments of interest to the lender.
With traditional roll-up equity release you do not make any repayments of interest but the interest is being rolled up, meaning the outstanding loan is growing all the time. Typically, with current interest rates the loan will double every 12 years or so, this means that if you borrowed ?10,000 in 12 year’s time you would owe ?20,000.
For those retirees that can afford the monthly repayments from their pensions or state benefits then the Halifax equity release plan makes perfect sense. Oddly, the plan is not available from the Halifax themselves; you have to seek advice from a specialist equity release broker. Getting advice is vital for this type of plan as the consequences of getting it wrong can be very costly and maybe cannot be put right during your lifetime.
Does Halifax equity release plan require a repayment vehicle?
The simple answer to this is NO it does not. As the Halifax equity release plan is an interest only mortgage for pensioners, no form of repayment is required. This is one of the unique features of the plan.
Your individual mortgage with the Halifax equity release scheme is allocated a term of 40 years, this should be ample to run for the rest of your life. In contrast to traditional interest only mortgages where the term allocated is generally a maximum of 25 years, the 40 years allocated should mean you will die prior to the term ending.
Can I pay off the Halifax equity release mortgage early?
Yes you can. You will, however, need to check that you do not have any early exit charges on the rate that you chose.
About the Author: Retirement Solutions is an indpendent financial adviser and specialist in equity release. We can also advise you on the Halifax equity release plan. Visit
retirementsolutions.co.uk/halifax-retirement-home-plan-mortgage
.
Source:
isnare.com
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