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Using equity release to help with rising costs

A home is supposed to be a place of sanctuary and comfort in retirement. However, as the cost-of-living crisis intensifies, many more homeowners over 55 are considering dipping into the value stored in their homes to boost their squeezed incomes and improve their bank balances to help create a safety net. This was the case for one of our clients, a 72-year-old women, who was struggling to pay soaring fuel costs and faced the prospect of not being able to heat her home.

The situation

Nothing can be as disheartening as losing a sense of self-reliance. Sadly, for one UK homeowner, this was quickly becoming a reality. The client, who had shared a 17th century property with her late husband of 40 years, suddenly found herself at odds, caught between rising fuel costs and signs of a bitter winter ahead. Her home used an expensive heating oil tank and was built with old systems and maintenance requirements. The increasing energy prices surpassed her pension income and she was faced with potentially having no heating in the winter months.

Homeowners with older properties can often run into challenges when seeking financial support, as many lenders and brokers are unwilling to help. This can often lead to being turned away or told that there are no options available. After many failed enquiries with other brokers, she was recommended to 55Plus by a friend who had successfully taken out a lifetime mortgage plan. We immediately went to work, to make sure our client could remain comfortably in her home.

How 55Plus helped

After an initial, no obligation phone consultation, we met with our client face-to-face, to discuss what options were available and to look at later life lending solutions as a last resort. As she already lived in the property and did not want to move, our equity release specialists explored the different ways that we could help. This included potentially speaking with family members for financial support, borrowing the money required as a loan, or using her own savings and investments first – before releasing equity as a final solution.

The client’s property was valued at £650,000. She was interested in releasing £25,000 to pay for the mounting fuel costs, as well as carrying out some minor home improvements that would help reduce future energy rates, such as insulation and installing a more efficient heating system. She was also interested in releasing a further £50,000 in equity from the property in a drawdown facility, which she could access as a security blanket in emergencies. Due to our client being anxious, vulnerable and without a family to rely on, she opted to have a close friend sit in with her at every meeting, to give her the trust and confidence that she was making the right decision – which we always recommend to anyone interested in later life lending.

The initial application took place across two weeks, ensuring all the necessary information was available and the terms of equity release were clear and understood by the client. Her best interests were always being met throughout the process.

The outcome

When we notified our client of a successful application, she felt genuine relief. Her fears of mounting bills and not being able to afford heating were gone and the extra money available in emergencies was always there if something were to happen in the future, giving her peace of mind.

Our expert advisers were able to find our client the financial help she needed, with a later life lending scheme that supported her unique circumstances. As independent equity release specialists we always work as a team and share our knowledge to find the best solutions for homeowners over 55. We believe later life lending can be used to support our clientele through difficult times, with the same shared value – that providing help when it’s needed is always more important than the cost of a sale.

Even when it’s an unusual property, such as an older home or a farmhouse, we have the market knowledge to find the right lenders for our clients. We maintain annual contact with all of our clientele, reviewing the rates of their later life mortgage to always find the best and lowest rates for their equity release scheme. This ensures that they always have expert support when it’s needed and peace of mind that they can enjoy retirement in comfort.

If you want to learn more about whether you qualify for a lifetime mortgage to meet rising energy and utility costs, please get in touch.