The message comes from Robert Bull, the Chief Executive of RoyaleLIfe, the UK’s largest provider of bungalow living for the over 45s.
Unlike conventional mortgages which are paid off over the term of the loan, equity release loans together with the accrued interest, are usually paid back after the borrower dies or goes into care. Because it’s compound interest the amount can snowball and eat into an inheritance.
Under Robert Bull’s leadership, RoyaleLife has been instrumental in helping popularise the phenomenon known as the ‘bungalow lifestyle.’ This approach to housing not only provides a low-maintenance and relaxation-focused approach to life, but it also enables owners to afford greater financial security as they enter the second half of their lives.
Robert Bull picks up the story: “While it may seem like a sound idea at the outset, equity release can have a sting in the tail.
“It’s true that you get to stay in your home, and you don’t make repayments on the money you’ve released until you die or go into care – but, the interest you’re charged on the loan does mount up.
“For example – say your house is worth £450,000 – and you release £100,000. After five years, with an interest rate of 6.5% – you’ll owe over £137,000. After 20 years that figure will rise to £350,000 – which is nearly as much as your house was worth in the first place.
“The brutal reality will be that you’re leaving next to nothing as an inheritance for the kids, or for your well-deserved retirement plans.”
Mr Bull explained that moving home couldn’t easier with RoyaleLife. Not only will RoyaleLife enable you to release valuable cash, but it will make your move completely hassle-free.
With its Home Part Exchange scheme RoyaleLife offers you 100% of the current market value of your home. So, if your current home is valued at £450,000, and you purchase a RoyaleLife bungalow for £300,000 that will leave you with £150,000 cash. He said the scheme was finding increasing popularity as people were growing increasingly anxious about what the future held.
What’s more, there will be no hidden costs: RoayleLife takes care of the estate agents’ and solicitors’ fees as well as any stamp duty. And with all its homes fully furnished with all home comforts and the very best appliances, there will be no large-scale removal fees.
The company offers a range of fully furnished two and three bedroomed bungalows with private driveways and gardens at luxurious gated developments, which can be found in some of the most desirable locations in the country. Prices start at £149,950 rising to £550,000.