How High are Equity Release Costs?
Equity Release costs is one of the most important factors in deciding whether to pursue this kind of financial product. The costs vary widely across various providers, so it is important to compare them and find out more about what you will be paying for before you sign on the dotted line.
Some providers charge as little as £995 for their Equity Release plans, which is a very competitive rate when you consider the high quality of service that they provide. In contrast, other providers can cost up to 20% more per year in fees alone.
A typical equity release plan could have annual costs averaging around £1430 – but if this might be too expensive for your budget then there are always cheaper alternatives available such as capped interest rates or life cover insurance options instead (such as those from Legal & General). The point here isn’t to scaremonger about how much it will cost; rather, it’s to educate people on what the ranges look like so that we’re able to make an informed decision before signing up.
Also, Equity Release costs are not the only expenditure to be aware of here. There’s also a lot of paperwork involved which could include fees for solicitors, estate agents and surveyors as well as stamp duty on property transactions.
All of these costs should be taken into account before going ahead with an Equity Release plan.
There are a number of different ways to get equity release costs down. You can lower your equity release costs by lowering the equity release amount: if you can lower your loan value (e.g. by selling off some of your property), this will reduce the costs that you have to pay for releasing it.
Also, try seeking a more affordable provider and comparing them on their fees, not just on how much they’re willing to give you as a lump sum in exchange for giving up all of your house or pension pot.
Try negotiating with providers over phone calls rather than through formal letters, which could save time and cost money as well since there’s no need to hire solicitors or estate agents. If these negotiations are successful then the supplier might even waive any legal fees involved with setting up an agreement between both parties.