Learn to be a Financial Hunter - Not the Hunted

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How To Find The Right

Equity Release Deal At The Best Price

STEP 4: Mull the figures over
There are 3 good rules to follow when trying to get a good equity release deal -
  1. Take your time when researching the market

  2. Never rush to sign up to a plan

  3. Make sure you understand everything, so if there's ever a point you're struggling with get it properly explained to you and if you still don't understand don't proceed until you do
Remember, banks and finance firms love customers who are uneducated in the products they're buying because they normally always make them the most money. Do not be one of them.

In the previous step you should have received details on about 2-6 different equity release deals so take a couple of weeks to mull these figures over, perhaps discussing them with friends and family who can offer you objective and honest advice.

As I said right at the beginning, the chances are your property is your largest financial commitment, dwarfing all the others. So entering any financial agreement directly relating to the property shouldn't be rushed. Plus, always be on the lookout for any financial advisor or company that tries to rush you they probably won't have your best interests at heart.

When thinking about the different equity release plans on your worksheet/grid spend time on the following points.

Look for and compare flexibility
I know I keep repeating this message but this is because it's of the utmost importance - when it comes to our money flexibility is what we should try to seek. Who knows for example what our financial situation will be in future years. So the best financial products are normally always the most flexible.

Having said that Equity Release is normally a pretty inflexible product, however some plans are more flexible than others and these are the ones you should concentrate on.

Balance flexibility with price
Yes flexibility is important, but then so is the price, and I think it's a good idea to try to balance them both. For example, there's no point going for the most flexible deal if it has a very expensive interest rate attached.

So consider the overall flexibility with the actual cost of the deal. Also, as I mentioned on the previous page don't be scared by high early repayment charges (ERCs) during the first 5 years as these are normal. Do however get concerned if any ERCs are still high after 5 years and especially after 10 years.

Some equity release deals even have ERCs payable up to 25 years, and these should be avoided.

You're almost there
You've now spent a fair amount of time researching the equity release market and are probably seriously considering a few different deals.

However, as indicated at the beginning of this guide, because you don't work in the Equity Release industry the lenders probably still have the upper hand. It's therefore possible you might have missed some of the small print tricks which normally translate into sneaky charges. And it's charges and fees that almost always make the difference between a good equity release deal and a bad one.

So in the next Step you're going to be asking your broker or lender 3 simple yet fail-safe questions that will help you decide which equity release deal is the right one for you.

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