According to recent research from RBS Reverse Mortgages, people are not taking out equity release mortgages, otherwise known as reverse mortgages, just to spend their children’s inheritance.
RBS Reverse Mortgages conducted a survey and discovered that repairs to the home and supplementing the retirement income are the two biggest reasons.
In equity release mortgages, or reverse mortgages, a person older than 60 years is able to borrow money against their property’s equity and do not pay interest until either they leave the property, sell it or die.
With an aging population and the recession as it is, many people from our older generations are finding they are low on cash but have a lot of equity tied up in their home. Savings are not earning the interest they were and so many are turning to equity release mortgages to make ends meet.
The equity release industry is growing at a rate of around 23 percent per year and although in the past, it has been criticised as being confusing and limiting for older people, new steps have meant more are seeing it as a viable option.
As a mortgage advisor, to deal with equity release mortgages you must have had specialist training culminating in the CeRER qualification. As a result of the growing industry, more and more mortgage advisors are now taking CeRER training.
For many of our older citizens, equity release means they can stay in the home they love and afford everyday necessities or luxuries.