The capital release will affect profits if the income earned places it above the profit threshold. If principal is used to repay a loan or mortgage, it is not classified as income and will not affect benefit payments. If you release your home equity, your tax status and your entitlement to state benefits, such as the pension credit, will be affected. It informs you the key facts about the different types of capital release and informs you of any danger of capital release.
This popular type of equity release is where you apply for a loan secured against the value of your home in exchange for a lump sum of cash or a reduction income. This happens when you release a percentage of your property's equity and pay a fixed interest rate on the contracted amount. Talk to a dedicated advisor for more information and a personalized illustration of how capital release costs may affect your financial situation. Please note that all calls are made by Key Equity Release, the UK's leading equity release specialists.
Capital release is classified as a loan and, as such, is exempt from resource-proven profit calculations; however, its benefits may be affected by capital release. It is very important that you continue to seek independent advice from a professional financial advisor before signing any agreement with a capital release provider. Pension credit, universal credit and reduced municipal taxes may be affected by capital release. Read on to find out if your entitlement to benefits is affected by the capital release.
One area that is not commonly understood is the impact that the release of capital can have on the state benefits proven by the media. Your financial advisor or mortgage advisor can help you decide if a capital release plan is appropriate or if you should consider other options, such as reducing your headcount. If you select a lifetime mortgage with a gradual reduction service, you can free up extra money from a reserve bank account when you need it. However, the state pension has additional payments that are subject to proof of income (pension credit) and may be affected by the release of capital.
Yes, depending on your financial situation and your choice of lender for capital release, you may find financial implications that could affect the type of care you can afford in the future. Therefore, your right to Universal Credit will be affected by the contracting of capital that causes your savings to exceed this threshold. Use an Accredited Provider Make sure that the supplier you use belongs to the Equity Release Council, so that you are protected from hazards such as negative capital.