If you have an Equity Release plan, moving house is still within your reach, but it’s a path that needs careful navigation. Here’s what to consider when relocating with an Equity Release plan in place.
Equity Release and moving: similar to a standard mortgage
- Just like with a standard mortgage, your Equity Release plan is a first charge loan. This means that when you sell your house, the Equity Release provider gets paid first, and you receive any leftover funds.
- If you’re planning on moving to a new property, the Equity Release plan can be transferred, but the new home must align with your provider’s criteria.
Selling and settling your Equity Release
- If you’re selling and don’t want to continue with Equity Release, it’s fairly straightforward. The key here is to be aware of any penalties or costs for early repayment.
Your provider can give you these details promptly.
Transferring your Equity Release to a new home
If you’re looking to move and transfer your plan, here are six crucial points to consider:
- Review original plan details:
Start with the initial terms provided by your lender, including moving house conditions and penalties. Remember, circumstances can change over time, so a fresh consultation is advisable. - Check current terms:
Market conditions influence lenders’ terms, so recheck them with your provider or advisor as soon as you consider moving. - Understand property requirements:
Your new home’s value, condition, location, and type (freehold or leasehold) will be scrutinised by the provider to ensure it meets their lending criteria. - Insurance matters:
Investigate insurance costs and conditions for the new property. This is essential not only for compliance but also to understand potential issues with the property. - Consider moving costs:
Be mindful of legal fees, admin charges, and survey costs associated with moving. - Explore the market:
A move is an excellent opportunity to review other lenders’ offerings. The market might have more competitive rates or better features than when you first took out your plan.
Seeking professional advice
- Consulting with a seasoned and qualified advisor is vital for a smooth transition. You’re not bound to stick with your original advisor – seeking a second opinion can provide fresh insights and help you make an informed decision.
Moving house with an Equity Release plan involves several factors, but with the right approach and guidance, it can be a feasible and rewarding journey.
