Retirement Advantage has recently launched a range of equity release products aimed at buy to let property investors and second home owners.
Retirement Advantage has released a series of three products for buy to let investors named the ‘Landlord Options.’ The products will offer clients freedom to choose whether they pay off any of their lifetime mortgage balance.
The ‘Landlord Lifestyle’ option involves offering clients a cash lump sum upfront, with interest rolling up for the entire duration of the loan. In contrast, the ‘Landlord Interest Select’ option will allow landlords to choose to service some or all of the interest. Completing the trio, the ‘Landlord Voluntary Select’ option lets investors contribute up to 10 per cent of the initial loan amount each year without facing any early repayment charge.
Retirement Advantage has explained that the range will give landlords the sought after option to release cash from their property portfolio tax-free.
Landlords will be able to take out a product on multiple properties in England, Scotland and Wales. The properties must be worth between £70,000 and £6 million. Those valued at above £6 million are set to be reviewed on a case by case basis.
As a whole, the equity release sector has performed well this year, noting a ‘record breaking’ second quarter, according to figures from the Equity Release Council. It was reported that £701 million had been withdrawn from homes between April and June 2017.
Retirement Advantage managing director Tom Evans commented on the products: ‘The buy to let product range is a further signal of our intent to deliver innovative new solutions for customers and advisers alike.’
The ‘Second Home Options’ range is similar to the buy to let range in that it offers a set of equity release products, with the same property value terms. Where they differentiate is that to release equity from a second home, the property must be for the sole occupancy of the owner and must be used by the owner for at least four weeks every year, meaning that it cannot be let out as a holiday home.