Lending platform wants customers to be able to explore options if they miss the cut-off
With the government’s Help to Buy scheme coming to an end, later life services platform Air has asked advisers to speak to their clients about equity release as an option if their younger relatives miss the October 31 deadline.
Stuart Wilson (pictured), chief executive at Air, said that with the current market uncertainty, the deadline to submit new applications for the scheme could not come at a worse time. He added that even applicants who have already applied must meet the March 31, 2023, completion deadline, and are expected to have the keys to their home by 6pm that day to be eligible for an equity loan.
Wilson further said that advisers who supported families as they look to use this scheme to help children or grandchildren on to the property ladder need to ensure that not only do they understand the deadlines but that there are other options to explore if they do miss the cut-off.
With buyers who use this scheme needing to find a deposit that is equal to 5% of the full purchase price of the property, he pointed out that equity release can also help people to secure this amount and qualify for the scheme.
According to Air, the equity release market is on track to hit over £6 billion in 2022 and figures suggest that one in five customers use equity release to provide some support for wider family. This, Wilson said, is a real opportunity for advisers to start the conversation for clients.
“While there is no doubt taking your first steps on to the property ladder at the moment is likely to be daunting, the end of October deadline is going to force people to either commit to buying something before March or miss this government support,” Wilson commented. “The changes to the Stamp Duty thresholds will no doubt help to mitigate this for some, but the fact remains that others will miss out and need to consider either putting off their dream or looking for additional help.
“Advisers need to help clients understand that there is a potential lifeline. Naturally, older people need to carefully consider the impact on their own finances which are also likely to be under pressure.
“Getting specialist advice is vitally important as it will help people to fully understand their options and make the right choices for their individual circumstances.”