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Older homeowners bringing inheritance forward

Robyn Hall

January 14, 2013

The topic of Bridgewater’s latest ‘Just a thought…’ sales aid concerns mature mortgagees who wish to gift family members money in order to help them move to a larger home. Such donations are becoming more common and show that it is not just first-time buyers that are sometimes in need of assistance, but also second movers too.

Bridgewater believe this is part of a wider trend in which older homeowners are choosing to bring forward their inheritance so their relatives can reap the benefits while they are still around rather than leaving them assets in a will.

The informative aid, aimed at introducer contacts, includes a case study of a family with two small children who have outgrown their two-bedroom house, but can’t quite afford to upgrade to a larger property so ask the husband’s parents to consider releasing some of the equity built up in their property.

Bridgewater’s ‘Just a thought…’ sales aids are designed to be used by advisers with their introducer contacts to help them understand the potential uses of equity release in a variety of situations and circumstances.

Chris Prior, manager sales and distribution, Bridgewater Equity Release, said: “The scenario outlined in our latest ‘Just a thought…’ guide is a reflection of the variety of different reasons why older homeowners may wish to release equity.

“We’ve heard about the ‘Bank of Gran and Granddad’ gifting money to grandchildren to help them get a foot on the property ladder, but those wishing to move up a rung are also finding it difficult in the current climate. Rather than wait until they pass away to bequeath money to family members at a time when they may not have as much need for it, older homeowners are bringing forward such donations when they can make much more of a difference.

“Releasing equity to help family members upgrade to a larger property is one of the many uses of home reversion plans and our series of sales aids is intended to help introducers identify those opportunities as and when they arise. Introducers may not be considering the equity release solution with some of their clients and it is important that advisers remind them of those circumstances where the products may be advantageous.

“There are many preconceptions about where and when equity release is suitable however we want to show that it is not only applicable in the more traditional areas of paying off debt and/or supplementing retirement income. While it can certainly be of use in those situations, many individuals are looking at the equity release option now in order to help family members who need financial assistance.”


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