The future role of equity release as a possible means of funding social care for pensioners has been welcomed by trade body Equity Release Council (formerly Safe Home Income Plans, SHIP) in response to recent Lib Dem research.
Interrogating Conservative plans for a residential social care scheme that would cost pensioners £8,000, the Liberal Democrats have called proposals ‘unworkable, unfair and unaffordable’.
Homeowners will have to sell or release equity to pay for care
Liberal Democrat research has highlighted that two thirds of pensioner households do not have enough assets, excluding their homes, to pay for care at a cost of £8,000 and they have stated that homeowners would have to sell or release equity from their properties to pay for the proposed Tory scheme.
Andrea Rozario, Director General of The Equity Release Council, said ‘With the country’s over-65s currently sharing £907 billion worth of equity in their homes, equity release is a practical solution to this funding crisis,’ and went on, ‘The use of housing equity poses a real possible solution to this complex problem.’
Equity release allows care within the home
Geoff Charles of Equity Release Specialists Bower agrees with the statement from The Equity Release Council saying, ‘We are increasingly seeing equity released from property used to fund care or support within the home. The money released is sometimes used to pay for anything from a gardener or general help around the home to private medical care. This so the individual(s) can stay in and be treated in their home where they – and their families – wish them to be.’
Equity release may involve a lifetime mortgage or home reversion plan. To understand the features and risks, please ask for a personalised illustration.
Bower is an FCA regulated independent financial advice company that offers specialist advice on equity release throughout the south of England. For more information e-mail [email protected] or call 0800 4118668. Bower offers a no obligation initial consultation to homeowners considering Equity Release.