SHIP – The Importance to the Equity Release Market
One of the key features of an equity release scheme taken out today is that it comes with a no negative equity guarantee, meaning that homeowners, releasing equity from their home, won t ever owe more than it is worth.
This guarantee is promised by Safe Home Income Plans (SHIP) whose code of conduct is adhered to by the majority of the market s leading providers.
Protecting the Consumer
Ever since 1991, SHIP has been protecting consumers with the no negative equity guarantee at the heart of their work. A home reversion plan has the potential to unlock a tax-free lump sum from the value of a property to supplement income in retirement.
As aforementioned, their code of conduct is upheld by the vast majority of the market. It is therefore beneficial to ensure that, when taking out an lifetime mortgage, you check to see whether the provider you are using promotes this.
Campaigning for Equity Release
However, SHIP s value to the equity market runs deeper than that. They continue to improve the public perception of lifetime mortgages whilst also campaigning to improve its use to the Government.
In these difficult financial times, funding retirement is becoming more and more of an issue for many homeowners. SHIP continues to champion the merits of a home reversion plan as a viable option that retirees could consider.
The hesitancy that still strangles the market to a degree, caused by the 1990s debacle, causes many people to think twice about taking out a plan. However, this is also where SHIPs involvement has proved invaluable in re-shaping some of these opinions; led by the no negative equity guarantee.
So, when considering an equity release scheme, make sure your provider adheres to the code of conduct.
Equity release could affect your current or future entitlement to means-tested benefits
Releasing equity to spend in your lifetime can reduce the amount that is left in your estate when you pass away