Equity Release

You'll want to understand all the facts about equity release before you take out your plan. Whilst one of our advisers will explain these to you during your appointment, we've answered some of the more common questions below:

What is equity release?

Equity release is a way of releasing some of the money that's tied up in your home, providing you with a cash lump sum.

You can continue to live in your home and use the money to get more from your retirement. Whether it's to top up your income, make home improvements, buy a new car or even take a special holiday - it's up to you how you spend it.

Taking a lump sum, plus the costs, will reduce the value you have in your home, and therefore the amount of any inheritance you leave. Your tax position and any entitlement to welfare benefits may also be affected.

Can you still leave an inheritance?

Although the amount of inheritance you can leave will always be reduced by equity release you can choose our inheritance guarantee on our lifetime mortgage plans to ensure you can leave something for your loved ones. However, this will reduce the amount of money you can borrow. Find out more about our lifetime mortgage inheritance guarantee.

With the Home Reversion Plan if you sell less than 100%, you will be able to guarantee an inheritance for your family from the sale of the property. The value of your share will be paid to you or your estate at the end of the plan.

Are you eligible for an equity release plan?

Equity release is available to homeowners aged 55 and over. The type of plan available to you and the amount you can release will depend on a number of factors including your age, value of property and type of property.

Find out if you're eligible for equity release here..

Does your home qualify?

Your home may qualify for a lifetime mortgage or Home Reversion Plan if it is a residential property of standard construction in England or Wales. Lifetime mortgages are also available for such properties in Scotland and Northern Ireland.

Please bear in mind that minimum property values apply. We are not able to offer equity release for properties in the Isle of Man or the Channel Islands.

The Home Reversion Plan is not offered for the following property types: flats, maisonettes, retirement properties, commercial property, sheltered accommodation, mobile homes, park homes, houseboats, new build properties (where the developer is still on site) and ex-local authority properties.

Lifetime mortgages are not offered for the following property types: freehold flat or maisonette, studio or basement flat, flat or maisonette in a local authority or housing authority block of more than four storeys, mobile home or houseboat, farm, hotel, guest house or B&B.

How much equity can you release?

This depends on a number of factors including the value of your home and your age when you start the plan.

For a general guide on if you're eligible and how much you may be able to release from your home please use our eligibility calculator.

Will I still own my own home?

With a lifetime mortgage, you keep ownership of your home. With the Home Reversion Plan, the ownership of your home is transferred to the reversion provider Grainger plc.

Both types of equity release plans offered by Aviva allow you to continue living in your home until you die or need to go into long term care.

How flexible are equity release plans?

With a lifetime mortgage you may be able to release more in the future, depending on the lending criteria at the time.

With a Home Reversion Plan, if you sell less than 100% of your home to the reversion provider, Grainger plc will guarantee to buy further shares from you as long as you meet the conditions of the plan.

Both products allow you to move home, subject to your new property meeting the conditions at the time.

Are there valuation and legal fees to pay?

The arrangement fee is deducted from the amount you receive. However, you will be required to pay a valuation fee up front and costs of a solicitor acting on your behalf. You can speak to one of our advisers to find out more.

What interest rate will be applied?

A lifetime mortgage has a higher interest rate applied to it than a standard mortgage, because you don't make any payments during the term of the mortgage. You can find out more about the current interest rates and APRs for each of our lifetime mortgages.

There aren't any interest rates with a Home Reversion Plan because it's not a loan – you sell all or part of your property at the outset of the plan to release the capital. One of our advisers will be able to help you decide which plan best suits your personal circumstances.

Are you still responsible for maintaining the property and paying bills?

Yes, the equity release plans offered by Aviva require you to maintain your property and keep it in a state of good repair. It's also still your responsibility to insure your property and pay all your property related bills, such as utilities and council tax.

Can you end the plan early?

Both the lifetime mortgage and the Home Reversion Plan are intended to last for the rest of your life.

With a Home Reversion Plan you can buy back the provider's share of your property, but you will have to pay the full market value, which is likely to be substantially more than the amount you received from the sale.

You can end a lifetime mortgage early, but you will have to pay off the full amount of the loan and interest accumulated and there may be a substantial early repayment charge.

Are there any tax implications?

It's important to understand that taking out an equity release plan will reduce the value you have in your home and therefore the inheritance you leave. You don't have to pay tax on the amount you release, but it may affect your tax position and entitlement to means tested benefits.

Is equity release regulated?

Yes, the equity release plans offered by Aviva are regulated by the Financial Services Authority (FSA). This is an independent body reporting to the government that helps to ensure that financial products offered to the public are fair and meet its required standards.

Aviva is also a member of Safe Home Income Plans (SHIP), a voluntary organisation that specialises in equity release, and we adhere to the strict standards set out in their code of practice.

How can you be sure if it's right for you?

With our choice of equity release plans, we aim to offer you a solution that fits your personal circumstances. Even so, we recognise that equity release isn't for everyone. So, we'll take the time to listen to your needs and concerns and if we think it's not right for you, we'll tell you.

Talk to one of our advisers

Our specialist advisers can answer your questions and give you all the information – and thinking time – you need. Simply book an appointment and one of our advisers will visit you at home to talk you through all the facts about equity release and the options open to you. Please note, they can only advise on products offered by Aviva.

This is a lifetime mortgage or home reversion plan. To understand the features and risks, ask for a personalised illustration.

Find out more on how to apply for equity release

How to apply for equity release

Lifetime mortgages and the Home Reversion Plan are not available in the Channel Islands and Isle of Man. The Home Reversion Plan is also not available in Northern Ireland or Scotland.

Aviva Equity Release UK Limited. No 3286484. Authorised and regulated by the Financial Services Authority. Aviva Equity Release UK Limited FSA Registration No 310433. Registered in England at 2 Rougier Street, York, YO90 1UU. www.aviva.co.uk

WC07048 04/2011