Equity Release
11th January 2012

PLS Solicitors have traditionally specialised in conveyancing, commercial property, employment and litigation. However, over the last few years, PLS Solicitors have been acting on behalf of clients in Cheshire and Greater Manchester who wish to release equity from their property. As equity release becomes an increasingly more important part of retirement planning, PLS Solicitors have decided to make this area of work a real focus for 2012 in the hope that it will open up exciting new opportunities.

An equity release scheme lets you raise money from your property – as either a lump sum or regular income, or both – and at the same time gives you, and a partner, the right to remain living there until you both die or move out.

There are two types of equity release scheme available in the market, with several variations on each. The lifetime mortgage involves taking out a new loan secured on your home, and the home reversion involves selling all, or part, of the ownership of your home. In return both types will pay you a lump sum and/or an income.

With a lifetime mortgage, you take out a new loan secured on your property. You do not make repayments, instead interest is rolled up to be paid when the scheme is ended. You continue to own and live in your home.

After you and your partner have died or moved into long-term care, your house is sold and the amount you borrowed, including rolled-up interest, is paid to the lender. Anything left over, after costs, passes to your, or your partner’s, estate.

With a home reversion plan, you sell all or part of your home, but you continue to live in your home. After you and your partner have died, your house is sold and the proceeds are split between the home reversion provider and your, or your partner’s, estate.

Clients are encouraged to first discuss the different options with their financial advisor. Once they have decided on the product, they can then instruct PLS Solicitors to act on their behalf.

PLS Solicitors are hoping to soon become an official recommended solicitor by SHIP, the body which looks after the needs of consumers from within the equity release industry. There will be more on this shortly.

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