Archive for the ‘SHIP’ tag
No Negative Equity Guarantee - Equity Release
It is one of SHIP’s most popular and recognised equity release guarantees. But what does it mean to the customer?
The no negative equity guarantee is a set-in-stone rule of SHIP governed equity release plans. It means that you will never owe more than the value of your home - no matter what.
Historically, house prices have always risen over long periods of time. Logically, this makes sense too as the population grows over time, thus increasing demand.
However, what should happen if property prices fall over the long term? The fixed interest rate will guarantee that your initial loan will grow exactly in the manner illustrated when you took out the plan. If property prices were to unexpectedly fall, then there may be a time in the future when the loan amount is higher than the price of the property. Fortunately, with a no-negative equity guarantee, the maximum repayable amount will never exceed the price of your property - even if the difference is very sizeable.
This can give you and your loved ones peace of mind that there is no debt left to your estate as a result of you taking out an equity release plan.
Use our equity release calculator to compare rough estimates of the amounts offered by the major equity release providers. Or for a more detailed and personalised comparison, call 0800 012 4180 for a free, no-obligation chat about equity release.
SHIP sees a 5% increase in new equity release customers in 2009
The leading equity release industry body, SHIP, have seen an increase in new customers looking to release equity in their property compared to this Quarter last year. Some attribute this to the recent rising house prices along with the shortfall that some see in their retirement allocations.
The fact that drawdown mortgages are now reported to take up 51% of the market suggests equity release is being used more as a scheduled supplement rather than for lump sum purchases.
Perhaps the increase is down to more government backing in the equity release industry after Baroness Hollis’ welcome intervention at the House of Lords:
Hollis claimed it was “distressing to see people unable to finance the retirement they need, while hanging onto an asset they could use.” See our views on the speech.
More recognition from the Government about equity release’s important role to play may see an even bigger increase for the next quarter.