Equity Release on Buy to Let Property

Equity Release on Buy to let image

Guide: Equity Release on Buy to Let Properties


New to the Equity Release market in the in 2019 is the ability to release a tax-free lump sum from your BTL property or BTL portfolio, make no monthly payments and keep the rental revenue received as income into retirement if you want.

Of course, you also have the choice and flexibly to decide whether to make interest and capital repayments or simply let the interest roll-up. These products allow older owners of Buy-to-Let properties greater ability to make the most of their property wealth.

The ‘voluntary overpayment’ options available allow you to service the interest if you wish. It’s a big decision but as a landlord you can release equity from your BTL property which you will still own for any legal reason including:

  • Home Improvements
  • Holidays/Cruises/Travel
  • Gift Money to Your Family
  • and more..

How Do I Qualify?

You need to be over 55 and your property needs to be worth over £70,000
or more, the property must be of standard construction (with some exceptions) and be let on an assured shorthold tenancy agreement (or AST for short).

How Do I Pay it Back?

Usually the loan is repaid on your death or you going into long term
care for more than 12 months. However, if you wish to make payments on a voluntary overpayment basis you can. There are no affordability assessments or income requirements.

You can take an initial amount and then in the future apply for further advance. A fixed interest rate will be applied to each further advance taken and may vary from the original interest rate provided. Each time you apply for additional borrowing the lender will send you a new offer which will advise of the new interest rate.

Request Your Free Guide

Key Features

  • 8 year fixed and defined early repayment charges.
  • Free valuations, with no cap.
  • No affordability assessments.
  • No minimum income requirements
  • Customers have a fixed interest rate for life
  • Open ended mortgage term
  • Options to make voluntary repayments

Benefits of a Buy-to-Let Mortgage

  • You retain ownership of the property for the rest of your life.
  • The money you release is tax free.
  • The ‘No Negative Equity Guarantee’ means that you will never owe more than the value of their property.
  • You can use the money released for any legal purpose.

At Equity Release Scotland, we feel it is equally important to highlight the negative aspects of buy-to-let equity release/buy-to-let lifetime mortgage. We want all of our clients to have total clarity and understanding of the products that they might be interested in buying, so that they can make an educated and informed decision in what is a very important matter.

Request a Call Back

Potential Risks of a Buy-to-Let Mortgage

The perfectly designed product has never existed, think about any car you have ever purchased, or for that matter any other product. There will always be things that you don’t like, so let’s take a look at some of the things you need to bear in mind when choosing a buy to let lifetime mortgage/buy to let equity release.

  • Taking out a Buy-to-Let mortgage may affect your entitlement to state benefits and grants. It’s important that you consult DWP in regards to any benefits you receive currently.
  • A Buy-to-Let mortgage may reduce the size of your estate.
  • A Buy-to-Let mortgage is a significant financial decision, take time to make an
    informed decision and make sure this type of loan is right for you.
  • A Buy-to-Let mortgage may work out to be more expensive in the long-term than selling the property.
  • You will not benefit from the protection of the FCA conduct rules or the Financial Services Compensation Scheme (FSCS).

How Much Can I Borrow?

Current LTVs (Loan-to-Values) – Source: Canada Life June 2019

AgeOver 55s Buy-to-Let Lifestyle
5514%

56

15%

57

16%

58

17%

59

18%

60

19%

61

20%

62

21%

63

22%

64

23%

65

24%

66

25%

67

26%
AgeOver 55s Buy-to-Let Lifestyle
6827%

69

28%

70

29%

71

30%

72

31%

73

32%

74

33%

75

34%

76

35%

77

36%

78

37%

79

38%

80-90

39%

The idea behind this section of our website is to provide you with some answers to the many questions that our clients invariably have.

We do not and never have engaged in pressuring our clients into purchasing a product. In fact, on some occasions, we have actually advised our clients not to move forward with equity release, as in our opinion it was not the appropriate vehicle for their needs, even though this advice cost the company money.

It is this kind of refreshing honesty that we believe sets Equity Release Scotland apart. We will walk you through every available option, explaining the pros and cons of each product, and answering any questions that you might have.

We view ourselves as a partner working with you to come up with the best solution, with the added advantage of being independent. This gives you access to a broad range of products, some of which offer exclusive rates or bonuses, which are not available on the high street.

Stop struggling with your current lifestyle, and put your property to work for you. It is time you reaped the rewards of your hard work, and began to enjoy some of life’s luxuries. You have absolutely nothing to lose, and a lot to gain, so for more information or to book a no-obligation appointment call our friendly and helpful customer services team today on 0333 360 1958 (Free Call)

Speak to one of our Local Equity Release Experts Today

Enquire Now

Equity Release - Benefits

Tax

There may be some tax implications that you need to take into consideration, but these will vary on an individual basis.

Advice

If and when you decide to move forward with your application, our team of advisors will assist you and answer any further questions you might have.

Assistance

Take you time and don’t ever be rushed into making a decision, whatever your requirements Equity Release Scotland will be there to assist you every step of the way.

Frequently Ask Questions

Once the money has been released to you, the choice on what to spend it on is entirely up to you. There are no restrictions whatsoever (provided it is legal!). So whether you want to go on a round the world trip, buy a new car, or simply pay off other debts, the choice is entirely yours.

Absolutely, that is one of the major benefits of this type of scheme, and it in our opinion is one of the more important foundations upon with the agreement is built. There is little point in removing the financial stress, if a few years down the road you are concerned about losing your home. In fact, not only are you entitled to remain in the home for the rest of your life, but so is anyone else mentioned in the agreement.

If everything goes according to plan, then it is entirely feasible for the money to be released to you between three and four weeks. However, always err on the side of caution and plan on the entire process taking up to eight weeks. The length of time is not entirely under our control, and can take even longer if your solicitor is unfamiliar with equity release schemes for instance.

When you sign the contract, you are simply agreeing to another style of mortgage, so the ownership of the property remains with you.

Request a Call Back

To get more advice and information, please fill out the form and we will be call you back.

Our Success Stories

What our Customers say About Us

Our Guarantees

Why you should always choose a product from a lender approved by the Equity Release Council

Guarantee 1

equity release council logo approvedYou have the Right to Remain in your Home for as long as you choose

Guarantee 2

equity release council logo approvedYou will NEVER owe more than the value of your home due to the "no negative equity" guarantee.

Guarantee 3

equity release council logo approvedYou have the freedom to move to another property without financial penalty (subject to provider criteria)

Summary
Review Date
Reviewed Item
Buy-to-Let Equity Release
Author Rating
51star1star1star1star1star
Click to Call
Accessibility