May 21, 2012

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The pros and cons of equity release

May 17, 2012 By Danielle J

Many older people use equity release plans to realise some cash from the value of their home. This can give them money that can be used how they choose during retirement, and is not repayable until after their death and their property is sold.

As people have started to live longer and remain fit and able enough to do lots of travel and other activities in their retirement, equity release plans have become more popular.

You can look up the different types of equity release schemes at Age Partnership, an independent company that researches all the different equity release plans available and finds the one that is most suitable for an individual’s circumstances.

There are two basic types of equity release – lifetime mortgages and home reversion plans.

A lifetime mortgage is a loan that uses the value of your property as security. Interest is added at a fixed or variable rate on the loan and you get a tax free cash sum or a regular income that you can receive. The loan is repaid after you pass away, when the property is sold.

A home reversion plan means selling all or a part of your home to the reversion company. In exchange, you get a lump sum of cash and to live in the property rent free until you pass away.

A drawdown option is more flexible as you take cash on the value of your home as and when you need it. You will only be liable to pay interest on the amounts withdrawn.

The advantages of these kinds of plans are that you get a lump sum tax free and will not usually have monthly repayments. You are free to do what you want with the money and can remain in your home as long as you wish. Some plans allow you to guarantee a portion of your home’s value as inheritance for your dependants. You can never be in more debt than the value of your home as the equity release plans come with a ‘no negative equity’ guarantee.

On the downside, this kind of plan reduces the value of your estate and it may affect your entitlements to benefits. You will also narrow down your options later in life. Compared with traditional mortgages, the interest rates on a lifetime mortgage can be high.

If you are interested in finding out more, there’s an equity release guide from Age Partnership available on the company’s website.

Filed Under: Property Tagged With: ,

Protect Your Assets When You Buy A House

April 19, 2012 By Danielle J

When you own a house, or more specifically, take out a mortgage in order to own a house, the mortgage lender will want to know that you have made provision to ensure that your mortgage will be covered if you get sick and are unable to work, or in the case of your death that the debt will be covered.

And during the process of making a mortgage application they’ll probably also offer you all kinds of insurance including income protection insurance, life insurance and critical illness insurance cover. Of course, you’re not obliged to take up any of these with the mortgage lender, you may have it all covered already, or you might be able to get a better deal elsewhere.

Whether you take up any of these insurance options depends on what kind of assets you have to fall back on in case of ill health. And of course, if you were to die, you’d want to make sure that your family’s finances were taken care of.

So, life insurance to cover the term of the mortgage is often a sensible idea. The best choice is probably to take term life insurance. This is where you set the number of years that the policy will run – and if you were to die during the policy period, the insurer would pay out. However, if you live beyond the term then you receive nothing. So, some people feel that you pay in to receive nothing at the end – provided that you outlive a policy. Of course, this is exactly the point of insurance – it insures you against the danger of dying before you have paid off the mortgage and leaving your family in the danger of having the house repossessed.

It’s important to shop around when looking for insurance policy quotes. Look for companies with good reputations like Suncorp – an Australian bank and insurance company that offers a whole range of personal insurance policies including critical illness insurance cover, life insurance, home insurance and car insurance. Suncorp life insurance pays a lump sum to the policy holder’s family on their death. Other life insurance policies work differently – with regular payments being made instead of a lump sum.

Whichever way you organise it – whether it’s through insurance policies or through invested savings – you need to make sure you have the ability to repay a mortgage should you die or become unable to work.

Filed Under: Property Tagged With: , ,

Don’t waste space in your home

April 2, 2012 By Danielle J

Many people find that their homes have rooms that get little or very occasional use, and yet they don’t have enough room in the rest of the house for what they want to do. For example, how often do you really eat in the dining room and how many days of the year does it sit there, museum-like, in a state of readiness for the next big occasion like Christmas or Easter?

With modern lifestyles, the traditional dining room gets less and less use, unless you make a real point of dining in there regularly. But if that all seems like too much trouble compared to sitting down to eat at the table in the kitchen, why not use the dining room for something else?

Dining rooms can make great home offices for example. You can easily change the furniture around in there to accommodate a desk and computer and perhaps a bookcase, too. It’s easy enough to run a phone line in there, or just use wireless connection to the internet.

Or you might want to do away with the dining table altogether, especially if you have one in the kitchen  or conservatory, and use the ‘dining room’ as a second sitting room. If this is the case, then you just need to pick out one of the many sofas that you see on sale these days and perhaps add a nice new rug and you’ve instantly got an extra living room. This can be really useful if you have older children who like to watch different things on TV or younger children who could do with more space to play with their board games etc.

Check out Harveys furniture store for ideas on how to revamp your dining room into a space that gets used 365 days a year and not just on Sundays!

Filed Under: Decorating, Home Improvements Tagged With: , , ,

Making the right improvements to sell your house

February 27, 2012 By Danielle J

As anyone who has experience will tell you, moving home can be a stressful time. This is especially the case if you have found your new dream home and are now in a desperate rush to quickly sell up and move.

If you have put time, effort and love into your home then the last thing you want is to be ripped off by selling at a lower price than you would like because you’re in a rush. So, to ensure you not only sell quickly but sell at the right price, make sure your home looks at its very best when you show around potential buyers.

Investing in a few key home improvements now could end up making you money in the long run when you sell your home for the price it deserves.

Starting in the kitchen, if your kitchen units, appliances or furniture are very old and battered then you may want to consider investing in some reasonably-priced but good quality kitchen items from a stockist such as Wren Kitchens. This isn’t to suggest that you pay for a brand new fully-fitted kitchen of course, but a few key pieces could make all the difference to the look of your kitchen and therefore how much you ultimately sell your home for.

You can take this approach to home improvements and apply it to all of the other rooms in your house. Rather than refitting everything, a few new additions or replacements and a spot of DIY here and there may be all that is needed to improve the look of your home and impress those potential buyers.

Putting in a bit of effort now and spending a little bit of money could end up saving you thousands when you get the asking price you were hoping for.

Filed Under: Decorating, Home Improvements Tagged With: , , , ,

Make your house a home

February 15, 2012 By Danielle J

Have you ever noticed how some people can have the most beautiful house in the world – but it doesn’t really feel like a true home?

And have you also noticed how often the reverse is also true?

You may find someone living in a really run-down area in a mediocre house, but from the moment you walk through the door you just know it’s a real home. It just has that certain something about it that yells happiness, contentment and a secure, contented nature at you.

There are so many programmes on the TV these days that concentrate on the house rather than the home. Rather like trendy magazines featuring rich celebrities and their cars and houses etc., it’s as if the programmes are specifically designed to create envy and dissatisfaction with oneself. People see it and want it – no matter what it is; everything rom cars, to clothes, to physiques and yes, to house.

You really have to dismiss all this kind of nonsense from your mind or you will never achieve true contentment. There will always be people with more than you have – which is of better quality – and if your nature is to feel envious of them, you must either decide to deal with it or face a life of continual discontent as the desire for more, bigger and better will never go away. The problem isn’t in the stuff – it’s in you.

Nevertheless, our homes are very important to human beings – whatever they look like. And it’s natural to make every effort to make them be a home – filled with things we love rather than those which are there to try and impress other people.

A cheap dining table and chairs that you happen to love for some reason you just can’t articulate – is a far better purchase than the best set money can buy that you’re continually worried about scratching and which is there to impress.

Similarly, if you love sitting in front of a fire in your scruffy old recliners on a cosy evening in – but they don’t quite match up to the “Jones’s” furnishings, who cares if you don’t? No-one is really judging you but yourself. So relax, be yourself – and, more importantly still, be true to yourself.

Filed Under: Home Improvements Tagged With: , , ,
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