Equity Release Post-Brexit: Lender Rates Fall Below 5%
In the aftermath of the EU referendum, many over 55s may be concerned as to whether equity release remains a viable option. The news from the industry, lead by the Equity Release Council, is that equity release has been unaffected, instead continuing to break records as retirees release equity from their homes.
Interest rates are continuing to drop and it is homeowners who ultimately benefit, with a wide range of flexible schemes to choose from in order to attain a financially secure retirement.
Post-Brexit Industry Rise
In early August, it was revealed releasing equity continues to grow in popularity despite Brexit. It is still viewed by retirees as a way to boost retirement finances , with the Equity Release Council reporting that homeowners released a record-breaking £8 million in housing wealth every day from April-June.
To put this into perspective, this is the first time the quarterly total for equity release has gone beyond half a billion. In the first six months of the year, homeowners did in fact cash in nearly £1 billion in released equity, and banks such as Santander and Legal & General will be offering schemes in the near future.
Following on from Brexit, there has been natural concerns for many families, such as if the referendum would lead to the second recession in a decade. Equity release shows no sign of being halted as it continues its quarterly record-breaking progress.
Falling Interest Rates
Interest rates are continuing to drop and it is homeowners who ultimately benefit. These are a few of the latest figures:
- One Family Mortgages: 2.96% variable
- Hodge Lifetime: 4.39%
- Legal & General 4.70%
- Liverpool Victoria: 4.70%
- Aviva: 4.72%
- More2life: 4.93%
The more over 55s borrow over the value of their property, generally the higher the rate of interest will be. This is complemented by a wide range of deals which offer cash back and help over 55s secure financial security in retirement, helping them set up their plan for a fee ranging typically between £600 and £2,000.
Getting Onto the Housing Ladder
It’s also been reported releasing equity has allowed 32 people per week to step onto the housing ladder, further highlighting the flexible and beneficial features of securing a large cash lump sum.
The Equity Release Council confirmed some 11,846 over 55s became new customers the first half of 2016. As it’s clear the market hasn’t been affected adversely in the aftermath of Brexit, it still remains a good opportunity for over 55s to become financially secure in retirement.