Equity releasers should consider remortgaging

Retired homeowners who have opted for equity release as a means of boosting their incomes are being advised to review the deal offered by their provider, and consider remortgaging.

According to Key Retirement Solutions, a firm of independent financial advisers specialising in equity release, retirees who have raised cash from their homes over the last five years or more may be able to find a more competitive deal.

In the UK, the equity release sector is continuing to grow; Safe Home Income Plans, the body that fosters good practice in the market, reported a 14% rise in the amount of money withdrawn from private residences in the three months to the end of June, compared with the previous quarter.

Competition between providers has also increased and according to Key Retirement, lifetime mortgage interest rates have fallen and are now typically 1% lower than in 2003.

The firm’s business development director, Dean Mirfin, explains that with some providers exit fees only apply for an initial period, after which consumers can make a true saving by making a switch.

Mr Mirfin advises that the process of remortgaging is simple and well worthwhile because the amount of money saved grows as the loan size increases.

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