by Chris Hill – Director of WBW Chartered Financial Planners

The budget announcement yesterday was not as some had feared in terms of tax rises, but there were some early indications of things to come with freezes on a number of tax allowances including the personal allowance, capital gains tax annual exemption, inheritance tax nil rate band and pensions lifetime allowance. There was also the announcement of new Green Bonds to be issued via NS&I in the summer. We are waiting on further details, but this could be interesting for those who want to use their savings to support climate change initiatives.

This month, I wanted to highlight several equity release cases that we have been dealing with:

  • We were recently involved in using equity release as part of a settlement for a claim against an estate. This meant that the widow would not be forced to sell the property in order to pay the family members bringing the claim.
  • Equity release has allowed a couple, who co-owned their property with the wife’s mother, to buy out the wife’s brother after the mother passed away and left the assets equally between both children.
  • We are currently working on replacing an equity release taken out 7 years ago with a new contract which will reduce the interest rates by more than half.
  • Finally, we were asked to speak to a client by a mortgage broker because they were concerned about the quality of advice being given by another firm. A Husband, requires an operation and there is currently a 3 year waiting list on the NHS. They have elected to go privately because he is unable to walk without the help of crutches. Their only asset is the property and they have little surplus income. They were advised to take out equity release, but because wife is below 55, they were advised that the equity release should be taken out in husband’s name only and wife is being pressured into transferring the property into his name and signing a waiver to any rights in the property. We were particularly concerned because they were not offered independent legal advice. We have worked with them to find a way for them to finance the operation until the wife reaches age 55 later this year, when she can become a party to the equity release, which will give her security.

Equity release is not right for everyone, but in the right circumstances it can be hugely beneficial. The current low interest environment is providing a unique opportunity with interest rates as low as 2.5% fixed for life.

We are always around to discuss whether equity release would be suitable for a particular set of circumstances.

Take care

WBW Chartered Financial Planners

If you would like to speak to a member of WBW Chartered Financial Planners about Equity Release or any other financial planning related queries that you may have, then you can arrange a consultation by calling 01626 202340 or email enquiries.cfp@wbw.co.uk.