Consumer Protection
Safeguards & Risks
We believe you should feel completely comfortable with your decision. Here is everything you need to know about how you are protected, and the important risks to consider.
What You Need to Know Before You Start
Equity release is carefully regulated in the UK to help protect homeowners like you, ensuring that any decision you make is done with confidence and clarity.
From the No Negative Equity Guarantee to strict advice standards set by the Financial Conduct Authority and the Equity Release Council, a range of safeguards are built into every plan we recommend.
Who Regulates Equity Release to Protect You?
There are two major organisations in the UK dedicated to ensuring you are treated fairly, honestly, and professionally.
The Role of the Financial Conduct Authority (FCA)
The Financial Conduct Authority (FCA) is the official body that regulates financial services in the UK, and it plays a vital role in protecting you if you are considering equity release.
All equity release advisers, lenders, and plans must be authorised and regulated by the FCA. This means they are legally required to treat you fairly, provide jargon-free information, and ensure that any recommendation is truly suitable for your personal needs.
This regulation gives you peace of mind that the advice you receive is professional, impartial, and puts your best interests first.
How the Equity Release Council Sets Standards
The Equity Release Council is the industry body dedicated to setting and safeguarding high standards. Its primary role is to ensure that all member providers and advisers follow a strict Code of Conduct designed to protect you.
This includes mandating key guarantees, such as your right to remain in your home for life, the 'no negative equity' guarantee, and the requirement that you receive independent legal advice before proceeding.
By choosing a provider and adviser who are members of the Council (like us), you can be confident your plan meets these high standards. When you see the ERC badge, it’s a sign that your protection is the top priority.
What Guarantees Are Included in an Equity Release Plan?
When you choose a plan approved by the Equity Release Council, you are automatically protected by these three core promises.
Understanding the No Negative-Equity Guarantee
One of the most comforting protections is the No Negative Equity Guarantee. Simply put, this means that when your property is eventually sold — usually when you pass away or move into long-term care — neither you nor your loved ones will ever owe more than the value of your home.
Even if property prices fall or the interest has built up over many years, any shortfall is completely written off by the lender. Your family will never be left with a debt from your equity release plan.
What You Need to Know About Staying in Your Home
With a lifetime mortgage, you retain 100% ownership of your property. You have the guaranteed right to live in your home for the rest of your life, or until you move into permanent long-term care.
As long as it remains your main residence and you abide by the agreement (like maintaining the building insurance), you cannot be forced to leave—no matter how long you live or how much interest accrues.
If you are a couple, the loan only needs to be repaid when the last surviving partner passes away or moves into long-term care. It is your home, and it stays your home.
Understanding Your Right to Move Without Penalty
Life changes, and you might want to move closer to family or downsize to a bungalow in the future. The Downsizing Protection Guarantee is an optional feature on many plans that gives you this flexibility.
It allows you to repay your loan without penalty if you move to a smaller property after a certain period (typically 5 years). Alternatively, approved plans allow you to "port" (move) your equity release plan to a new property, provided it meets the lender's criteria.
This ensures you are never "locked in" to your current house if your health or family needs change..
What Are the Key Risks of Equity Release?
We believe in being completely open about the potential downsides, so you can make a balanced decision that is right for your family.
How the Loan Affects Your Remaining Equity
The loan, plus interest, is usually repaid from the sale of your home when you pass away or move into care. Because interest typically compounds (adds up) over time, the amount you owe will grow.
This will reduce the remaining equity in your home. However, thanks to the No Negative Equity Guarantee, you have the security of knowing you will never owe more than the value of the property, no matter how interest rates change or how long the loan runs.
Remember, you remain the legal owner, so you will still benefit from any increase in your home's value on the portion of equity you still hold.
Understanding the Impact on Inheritance
Because the loan is repaid from the sale of your home, it will reduce the value of the estate you leave behind to your loved ones.
While some plans offer "inheritance protection" features that allow you to ring-fence a percentage of your home's value for your family, it is important to consider how releasing funds now might affect your wishes for the future.
Our Advice : We encourage involving your family in the conversation. A qualified adviser will explain these impacts clearly so everyone understands the outcome.
How Equity Release Affects Means-Tested Benefits
Releasing cash from your home can affect your eligibility for means-tested state benefits, such as Pension Credit, Council Tax Support, or Universal Credit.
This is because the money you release may be treated as savings (capital) or income. If your savings go above a certain threshold, you could lose some or all of your entitlement.
This is why personalised advice is crucial. We will review your benefits situation first to ensure you don't accidentally lose support you are entitled to.
What You Need to Know About Early Repayment Charges
Equity release plans are designed to be long-term commitments, usually for the rest of your life. If you decide to pay off the loan early, you may face Early Repayment Charges.
These charges can be significant, especially in the early years. However, many modern plans are more flexible, offering features like "downsizing protection" (allowing you to move without penalty after 5 years) or compassionate waivers if a partner passes away.
We will always explain these potential charges upfront so you can choose a plan that offers the flexibility you might need later on.
Get the right advice and the confidence that comes with it
Take the first step towards financial clarity today. There is no obligation and no pressure. Just a friendly conversation to answer your questions.
Fees
A Lifetime Mortgage may reduce the value of your estate and could affect your entitlement to benefits. To understand the features and risks please ask us for a personalised illustration.
There will be a fee for mortgage advice. The precise amount will depend upon your circumstances but we estimate that it will be £1495 for an equity release/retirement mortgage.
Important Information
Aspect Mortgages Limited is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register (https://register.fca.org.uk/s/) under reference 305352. The FCA do not regulate Business Buy to Let Mortgages or Estate Planning.
As independent advisers we have access to the whole market, except for deals that you can only obtain by going direct to a lender. Registered in England and Wales No: 051013801. 16 St Thomas' Road, Chorley, PR7 1HR.
Your home may be repossessed if you do not keep up repayments on your mortgage.
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