A home reversion plan is an arrangement where the following conditions are met:-
The plan provider buys all or part of a qualifying interest in land or property. The seller is entitled to occupy at least 40% of the land as a dwelling.The arrangement specifies one or more qualifying termination event at which point the arrangement will end.
A qualifying termination event is where:-
The person becomes a resident of a care home
· The person dies
· The end of a specified period of at least 20 years, beginning with the day the seller entered into the arrangement.
The differences are as follows:-
The homeowner transfers ownership of some or all of the property to a company in exchange for a cash sum or an income
No interest is paid to the company
The original owner retains the right to live in the house until death
On death, the property (or part of it) reverts to the company which is where the term ‘home reversion’ comes from.
Again drawdown facilities are available and the funds can be used to be an annuity for life as a steady income or cash lump sum can be taken.
Minimum Val range from 80k to 100k
Minimum age is 65 to 70 or joint age of 140
Not permitted in Scotland due to 20 year limit on residential leases.
For more information call Solution Mortgages on 0845 123 1260.