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19
Nov

Why the Aviva Equity Release Calculator doesn’t Show Whole of Market Results

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Aviva is one equity release company providing retired or near retirement homeowners a chance to improve their cash poor situation. If you have entered retirement and find you are spending your retirement pension too fast there are only a couple of things you can do. You can adjust your lifestyle, downsize, or find a way to supplement your income. Equity release products such as the Aviva Lump Sum Max plan is a lifetime mortgage. To find out how this product can help you there are necessary tools like the Aviva equity release calculator available to you.

How Aviva Works
Aviva provides certain products for individuals over the age of 55. However, their products are announced on sites like Equity Release Supermarket and through a brokerage firm. If you go directly to their website, select the product shown, you will be sent to a brokerage firm that is not independent. They do not offer independent equity release advice. It is an agreement they have made with Aviva. It also means the product mentioned on Aviva’s website and through this tied sales team is not as competitive as Aviva products you can find on Equity Release Supermarket. You can use the safety net of a company you recognise and trust by choosing Aviva, but you do need to be aware the product may be a poorer deal for your beneficiaries on the long term.

Lifetime Mortgages
Lifetime mortgages are a loan for retired individuals because you make no payment towards the principle amount. There are only a few products which are interest only, where you do make an interest payment each month, but the product is not repaid in full until the end of your life. The Max Lump Sum plan from Aviva is a straightforward lifetime mortgage in that you make no repayments and pay no interest until the end. When you die or need long term care your loan will need to be repaid, often through the sale of your home. This is where it can become difficult for your beneficiaries. The sale of the home has to cover the capital sum plus any interest that has accrued. The more interest that accrues the less that is left over.

When you have a non-competitive product this means the interest rate is not in line with other equity release products. It could be significantly higher than competitive products found through independent brokers.

Independent Brokers
An independent broker is going to look for the best product for you. They will find the lowest interest rate for the maximum amount of value possible. You get to decide the best deal. Sometimes you may have to go for a higher interest rate to unlock the maximum amount you need.

An equity release calculator can be used to determine the maximum amount to be released such as 30% at age 65 versus 40% at 75. You can change items in the calculator to fit the competitive products on the market; however, Aviva equity release calculator does not allow for this. The Aviva tool is specific to the Aviva Lump Sum Max Plan. It will not provide results for any other plan even other Aviva products sold on independent sites. It limits your knowledge of available options. An independent calculator would not do this.

The Products on the Market
Aviva, Pure Retirement, and Just Retirement offer some of the equity release lifetime mortgage products on the market right now. At age 65 all offer 30% of the home value in a loan to value percentage based on age and home value. The percentage allows for the accrual of interest while keeping the loan low enough that it should not hit negative equity.

The older you are the more you can release which is why at age 75 you could get 41% from Aviva and 42% from Pure Retirement. Pure Retirement also offers free valuation, the larger cash back option, and no application fee if the loan is for more than £45,000.

Overall, you want to make certain you are working with an independent tool to get the best information possible. It may turn out for your needs and situation Aviva is the perfect company to go with through the brokerage firm. On the other hand you may find the Aviva equity release calculator results are not apropos for your situation and thus you need to shop around more. Using independent tools you can save time in your research.

14
Aug

Does an Equity Release Calculator for the under 55s Actually Exist?

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Searching for an equity release calculator for the under 55s is unfortunately not going to produce the results you hope for. Yet, many people do conduct a search online for this tool, which is one reason many websites and articles use the keyword to get your attention. There are some important facts you need to understand about equity release for retirees. The first is that equity release (ER) is for individuals over 55. Since it is a minimum age, there is not going to be a calculator that provides a calculation for an individual who is younger than this. One of the reasons the phrase is still used and targeted is because of planning.

People who want to plan for their retirement can find the calculator useful as they plan for their retirement day. The calculator can certainly provide some details that will help with the planning.

What ER Calculators Provide
As an equity release calculator for the under 55s does not exist, you will need to use a standard equity release mortgage calculator. It can still provide you with helpful information. You can also look for such options as the impaired equity release calculator that provides results for potential ill health issues. Impaired health allows you to gain a larger lump sum of tax-free cash than a healthier retiree. Of course, if you do not need a bigger sum of cash, it is best to stick with the standard ER. You also have calculators specifically for interest only lifetime mortgage products and home reversion.

An interest only lifetime mortgage provides you with a capital lump sum where you pay interest off each month to keep that sum the same throughout the life of the loan. Every lifetime mortgage will have interest and the entire amount is due at death or a move to a long term care facility. Basically, when you move from your home you need to pay it back. With interest only it is more affordable and leaves an inheritance behind if you pay off the interest, versus a loan that accrues until death, leaving a large sum to be repaid.

With appreciation and depreciation a home value can change and wipe out any inheritance if you have interest adding to the loan too.

Home reversion is different because it is a sale of all or part of your home. With the sale you still live rent free under a lifetime tenancy agreement, you can stay until death or until you decide to move to long term care, and only at the end is the rest of the house sold to the buyer. Any home left to sell is converted to cash for your beneficiaries. Buyers are investing in the appreciation of the home as a way to make their money.

ER calculators will be able to provide you with a potential maximum amount you can be lent, along with figures for what you may owe in the end. This gives you an idea of whether the option is affordable for you or not.

Possible Products
The market is flooded with products as more people begin to retire. Also changes to the regulations of these loans have meant a change in availability of certain products. The calculator uses the age of the person, plus the home value, to determine the maximum amount allowable. A loan to value percentage is the maximum amount for a specific age a person can obtain.

For example, Aviva is offering a product to 55 year olds where you receive 20.5% of your home value in an ER loan. Stonehaven’s Interest Select Max (interest only loan) provides 19% of the home value.

The older you are the higher your loan to value ratio will be on the assumption the loan will not be outstanding for as long. Thus, someone 65 years of age from Aviva can receive 30% of the home value in an ER. The Stonehaven ISM plan offers 29%. If you go with Aviva and are 65 years of age with a home value of £100K you would receive £30,000 in a maximum amount.

You should be aware that not all providers offer 55 year olds ERs. For example Just Retirement, LV=, New Life, and Pure Retirement require you to be 60 years old at least. This will change the calculations you receive from the ER calculator. As no equity release calculator for under 55s exists, just make certain you use an independent calculator that can provide accurate results for your situation.

20
Feb

Is Using an Equity Release Calculator Dangerous?

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For those people struggling to manage on their pensionable income or looking for finance for a larger purchase, there can be few options for conventional finance when you reach a certain age, especially when on a restricted income. Equity release schemes have been especially designed for the over fifty-fives age group. They allow home owners to release the equity tied up in their home, without needing to move home or make monthly payments compromising their monthly disposable income. There are a number of equity release calculator tools available, these can allow you to explore equity release, compare deals tables and confirm whether you meet the eligibility criteria. However, in this age of cyber crime, many people worry about whether using an equity release calculator is dangerous.

What Are Equity Release Calculator Tools?

An equity release calculator is an online tool which is provided free of charge on the websites of equity release companies and brokers. They allow people to learn more about equity release, compare deals tables and establish whether they would qualify for an equity release scheme.

These calculator tools have been pre-programmed with qualification criteria such as:

• You need to be aged between fifty-five and ninety five
• You must be a UK home owner
• Your property value must be a minimum of £50,000.

By answering the questions posed by the equity release calculator, home owners can determine if they meet the specific criteria, learn what the maximum lump sum offered would be and receive details of the schemes and plans which are appropriate to their circumstances.

Why Would an Equity Release Calculator be Dangerous?

In order to ascertain your qualification for equity release, you will be asked questions about your personal circumstances and your property. However, there is little concern about them being dangerous. Most calculators offer complete confidentiality. In fact, many calculators will allow you to use them anonymously without providing any identifying information. Although you may be asked for your age, gender and postcode, this is not sufficient information for any type of fraud. However, you should be wary of any calculator which will not function without you providing your personal contact information.

In most cases, the calculator may prompt you with a question of whether you would like an adviser or broker to contact you, but this is an optional service. Most lenders and brokers appreciate that home owners wish to shop around with no commitment or sales pressure. This means that they allow their calculators to be used for free and will actively encourage home owners to use multiple calculators to gain a good insight into the products available on the market.

Can the Figures from an Equity Release Calculator be Relied Upon?

Many people are also wary of basing their future plans on the figures provided by an equity release calculator. Many of these calculators are extremely accurate, but there are some limitations. These include:

• They work on mathematics only: The calculators are programmed to work out a mathematical formula only. This means that they are only accurate if you have provided accurate information. They have no facility to check the market values which are current in your area, the balance of your outstanding finance or other details. This puts the responsibility on the home owner to ensure that the information they enter into the calculator is accurate.
• They are restricted to a particular product range: Calculators are only programmed to the criteria of the specific product range. Calculators on specific company websites will be tied to their particular range of products. It can provide a wider range of product information if you use a calculator from an independent broker. It is also recommended that you use more than one calculator to assess the marketplace more fully.
• Check comparison tools: It is also a good idea to check websites which offer equity release compare deals tables. These provide simple tables which allow you to compare different rates and packages. This can be a simple way to check the financial implications of equity release without giving any personal details.

If you are interested in equity release, compare deals tables and equity release calculator tools can be extremely beneficial for your research. This can enable you to move forward with a more rounded knowledge about equity release and the types of deals which are available for your circumstances. This can enable you in making informed decisions and choices about whether you would like to move forward or explore alternative avenues.

14
Feb

All Aboard the Income for Life Train

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Many people dream of the prospect of their retirement. However, in the current economic climate with quantitative easing measures which have compromised the real world value or pensions, a great number of people are worrying about the prospects for their retirement. Once you reach retirement age, the avenues to conventional finance can sometimes be closed to you. However, equity release schemes have been specifically designed for the over fifty-fives age group. This can enable you to release funds tied up in your property. Equity release calculator programmes are readily available to check whether you would qualify and how much you could expect to receive.

How Equity is Defined
Equity could be described as your stake in your property. Equity release calculator tools essentially calculate your equity by taking the balance of any outstanding mortgage from the value of your home. When you first purchased your property, you may have borrowed ninety per cent of the property price from the bank as a conventional mortgage. This would mean that you would have had ten per cent equity. As time passes and you pay off more of your mortgage, together with property prices increasing, you would find that you have more and more equity tied up in your home. For many retired people, they have little to no mortgage on their home, but may be struggling for actual cash.

For the purposes of equity release, many people can expect to release between thirty and fifty per cent of their equity as a lump sum or additional income. The reason for this is that the equity release loan requires no monthly payments. The interest on the loan is accrued and added to the balance of the loan in the form of compound interest. You are guaranteed the right to residency in your home for the rest of your life and the balance of the loan is only repaid once you have passed away, or if you move into a care home for the long term.

The Benefits of Equity Release
When considering equity release from your property, equity release calculator tools can highlight a number of benefits from specific equity release packages. However, there are numerous benefits to equity release which apply to the majority of schemes. These include:

  • Obtain a lump sum or an additional income stream: When choosing equity release, you will have the option of obtaining a tax free lump sum or an additional income. The equity release product allows you to borrow money against the value of your property to finance this sum. This can be very helpful if you are planning a large purchase such as a second home, need to supplement your pension or are looking to financially assist your children or grandchildren. There is no restriction to how you spend the lump sum or income; it is yours to do with as you please.
  • Improved lifestyle: For many people equity release is an effective method of improving their lifestyle. Essentially you have leveraged the value of your property in order to live off your investment. This can mean that you have additional disposable income without compromising your existing income. This could mean that you could take a once in a lifetime dream holiday or simply spend more time with your family. This type of scheme can allow you to fully enjoy your retirement without worrying about bills and finances.
  • Effective tax planning: Not only is your equity release sum tax free but you can use the funds to plan tax effectively. Many people opt for an income or draw down facility rather than a lump sum so that they can minimise their tax risk and not compromise their eligibility for certain means tested financial assistance. However, some people utilise equity release as a method of inheritance planning. By gifting money to your beneficiaries while you are still alive, you reduce the risk that they will need to pay inheritance tax when you pass away. The current inheritance tax threshold is set at £325,000. This may seem like a high amount but it will include the value of your property. By releasing the equity from your home, you can continue to live in your home but financially assist your family and help them to avoid paying inheritance tax in the future.

 

If you are interested in releasing equity from your property, equity release calculator tools can provide a good starting point for your research. They can provide you with details of schemes which you would qualify for and provide an insight into the maximum lump sum you would receive. This will enable you to have the information necessary to make an informed choice about proceeding forward with an application.

21
Oct

Comparing Equity Release Plans and Providers

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As a pensioner, it is not always possible to meet your daily needs with the little pension amount that you receive on a monthly basis. With an equity release plan, you might just be able to secure your retired life; however, you will need to have ownership of a property. There are many different types of equity release schemes which will make it possible for you to release money from all or a portion of your property.

The great thing about equity release plans is that you do not have to leave your home even if you sell it to an equity release provider. Eventually, when you die or move into long term care, your property will be sold to repay the equity release provider.

In order to choose the right equity release plan or the right equity release provider, you will need to compare equity release mortgages. The internet is filled with many different useful websites such as www.EquityReleasePlans.net who make it possible for you to compare and analyze the different equity release plans and providers so that you can chose the plan and provider that are best suited to meet your needs and requirements. They can be contacted on 0800 678 5169

These websites are free, interactive and can be of great assistance when conducting your own research on equity release. These websites make it possible for you to easily compare equity release plans and providers through the use of equity release calculators. Equity release calculators make it possible for you to instantly determine how much money you can borrow from a specific provider. Equity release calculators are the perfect way to compare equity release plans and providers.

When comparing equity release providers, you should make sure that you check the reliability and the credibility of each company as well as the total amount of years that it has been in business. One of the most important factors to focus on when comparing equity release providers is the interest rate that they offer. Based on its reliability, credibility, and experience, you will be able to choose an equity release provider that offers the highest returns from releasing equity from your property.