Interest-only equity release has improved
Interest-only equity release products are something all brokers should look into claims Steve Wilkie, managing director of Responsible Equity Release.
Stonehaven recently launched interest-only equity release products which Wilkie said have competitive interest rates at 6.13% and loan-to-value dependent on age.
He said that a key area where Stonehaven’s recently launched products differ to similar products in the past is their far more reasonable affordability criteria.
He said: “Not long ago the criteria were so punitive that it wasn’t even worth wasting the ink needed to fill in the application form.
“But the new breed of interest-only products are different. The criteria are achievable for the majority of applicants and as a result they are going down a treat with brokers.”
With the interest-only Equity release products, clients can decide how much interest they want to pay depending on the product. Typically there is a minimum monthly payment.
Wilkie added: “The client will usually get to choose how long they want to pay the interest too.
“If the client does select to pay part of the interest, and most tend to, then a two part loan will generally be set up for them where the unpaid interest rolls up as per standard equity release product.
“It’s also worth saying that these products can revert to a regular equity release product should clients wish to stop paying the interest payments. So the interest-only bit isn’t set in stone. This brings real flexibility.”
More information on equity release products can be found on the Responsible Equity Release website.
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