The equity release market is one of the fastest growing sectors of the financial services industry. Unlocking money from homes to support low incomes has proven to be an attractive option especially in times of falling stock markets, low interest rates and under-performing pension schemes. Lawyers and financial advisers need to be aware of the legal framework in which such equity release schemes operate. This new guide provides: * a comprehensive review of the various types of schemes available * advice on the professional and practical issues surrounding such schemes * an insight into how such schemes can be used to mitigate inheritance tax, pay for residential care, fund speculative investment, and help settle matrimonial settlements; and * an examination of the safety procedures in force to protect clients including those of the FSA and various Codes of Conduct Equity Release: A Practitioner's Guide is essential reading for all private client and property lawyers, as well as financial advisers.
Table of Contents
1. INTRODUCTION What is Equity Release? The Market environment Client Profile Analysis of Market and Client Profile 2. EQUITY RELEASE SCHEMES Overview Home Reversion Schemes Lifetime Mortgages: Home Equity Release Mortgage (HERM) Annuity Based Schemes Common Factors 3. ADVISING THE CLIENT Professional Issues Alternative Solutions Practical Issues Check-out the Provider/Adviser 4. EQUITY RELEASE: USES AND ABUSES Mitigating Inheritance Tax Funding Residential Care Supplementing Income and/or Capital Speculative Investment Living Inheritance Matrimonial Settlement Buying Property Overseas 5. SAFEGUARDS Introduction Codes of Conduct Financial Services Authority (FSA) Consumer Credit Act 1974 Annuity and Investment Based Schemes Prescribed Warnings Professional Indemnity APPENDICES 1.Useful Addresses 2.Further Reading 3.Roll-up Loan Interest Table 4.Standard SHIP Certificate 5.Precedents
Jonathan Wilkey, Partner, Gwyn James Solicitors