Q. Can I protect the equity in my home if I have an Equity Release arrangement on it?
When I die I want any money left from the sale of the property to be available immediately to my children and not have to go through probate and I also want the benefit of protection for them that a Trust offers, such as ensuring that they don’t lose 50% of their inheritance if they were to subsequently divorce or 100% if they were made bankrupt for example, which they won’t get if they get the money absolutely via my estate.
A.YES - 100% WE CAN PROTECT A PROPERTY IF IT IS ALREADY IN EQUITY RELEASE
1. The equity release company are not affected and do not need to be advised
2. The Land registry is not changed in relation to ownership now
3. A RESTRICTION is put on the Land registry under the Land Registration Act 2002
4. This means that once the Equity release company have been paid out under their restriction instead of the property then belonging to the current owner, it belongs instead to the Trustees of the Trust set up by the current owner (now referred to as the Settlor).
5. The Trustees in this instance then open a bank account under the Trust name and the remainder of the money from the sale of the property, after the Equity Release company has been paid out goes into it.
6. Usual rules apply - there must be good reasons to set up the Trust other than not wishing the Local Authority to be able to include the money from the sale of the property should the Settlor go into care (deliberate deprivation of assets) as clearly set out in our instruction form.
HOWEVER, and suffice to say folks,
SO LONG AS IT IS DONE CORRECTLY AND ACCORDING TO OUR INSTRUCTIONS
They won't be able to!!
Another protection in a nutshell brought to you by
If you would like to find out more about Equity release then please call us on 0800 668 11 64 and our FCA regulated Equity Release Specialist will be glad to assist you.