Retirement can be a stressful time when it comes to finances, especially if you have outstanding debts which need to be paid off each month. However, if you own your own home, there are products available such as the Stonehaven equity release plan which will enable you to use your home to raise cash and consolidate your debts.
The Stonehaven Interest Select Products
In a nutshell, you can borrow a lump sum against your house to consolidate any debts and leave a little left over as an emergency fund for enjoying your retirement. You only pay interest each month, which means that you can easily budget for one interest payment instead of the larger individual payments which you used to make for the credit cards and unsecured loans.
As you are paying off interest only, the lump sum is only paid off when you die and the house is sold, with any remaining money going to your estate and children. The kids still get most of the inheritance – and you get to stop worrying.
Easier to manage, this form of retirement home plan means that your home is working for you - retirement is a time when you are supposed to enjoy yourself and let your hair down a little, not a time when you should be worrying about money.
Numerous Choices Exist
Stonehaven is known for their interest only lifetime mortgage products. They are not the only company to offer you a plan for your retirement. You do not have to depend on them for your entire retirement budget even. Instead, it is better that you research all the available plans out there and not overlook anything. If you decide to overlook products you could hit upon a dangerous situation with the one product you chose. This is because products are not designed for every homeowner. Rather products are designed to be the best for certain homeowner situations. Yours may not fit this particular bill.
The first thing to do is decide what your current budget is. How much do you have in your retirement funds? How long will that last with your current spending habits? Is there a potential that you could downsize your home, save money, and therefore make your current funds last longer? You must always consider the alternatives to equity release first.
Stonehaven & its similar compatriot the More2life Interest Select plan both fall under the rules of MMR (Mortgage Market Review) which were introduced in April 2014. These new rules have forced both Stonehaven and More2life to now start evidencing proof of income to show affordability. Prior to this, both equity release companies did not need to show proof of income to justify them lending to people over age 55.
When you have exhausted your current budget it is time to assess the different products on the market besides the interest only lifetime mortgage from Stonehaven. You have three other types of lifetime mortgages and these three options do not require a monthly payment. It is nice to make an interest payment to keep the loan amount the same and to ensure an inheritance; however, you may not have the disposable income to make payments.
If this sounds like you then consider researching products such as drawdown, roll up, and enhanced lifetime mortgages. Also consider what home reversion might be able to provide for you.
Selling Your Home is an Option
Home reversion is a home equity sale. It is not as popular as even five years ago due to some changes in the industry. It has also gotten a lot of flack due to improper information that is more myth than truth. Basically you live in your home rent free under a lifetime tenancy agreement. You decide how much of your property you wish to sell in order to raise a capital lump sum. This is allowed until death or you decide to move out.
What you do is sell a part of your home. You can even sell the entire home to a buyer. This buyer is an investment company specifically offering home reversion. They began this as a way to invest in real estate long term. You receive funds for your retirement and in exchange they get to sell your home for its current value after you move on. Since they give you an under value amount even for the entire property, they make money on the sale. If the house appreciates while you live in it they gain even more funds from the sale.
It is a pretty decent win for them and you still get to live more comfortably. It is not an option for everyone of course, but something to mention as you contemplate the various lifetime mortgages including the Stonehaven product. It is better to be armed with a lot of information than to have questions or the wrong product for the rest of your life in the home you love.
In essence then, the interest only lifetime mortgage plans of Stonehaven allow you to budget more easily and potentially reduce monthly payments with their lower interest rates which are fixed for life. You can find out more useful information about this retirement plan by doing an online search for Stonehaven equity release.