Opportunity
The home reversion market is set to increase substantially, partly because of Norwich Union's entry, but also because of the higher profile that equity release now enjoys since Lifetime Mortgages came under FSA regulation in October 2004. Home reversions also came under the FSA in April 2007.
Furthermore, uncertainty about the housing market and interest rates may prompt more people to opt for the security of a plan that provides certainty from the outset.
Grainger is well-placed to benefit from these conditions through its focus on distribution through Norwich Union and IFAs. Meanwhile, we will continue to seek to acquire existing home reversion portfolios.
Equity release offers home-owners in or near retirement the
opportunity to access some of the value of their home while continuing to live there for the rest of their
lives. There are broadly two types of Equity Release options:
- Home reversions offer home owners the option to sell part or all of the equity in their home rather than borrow money. Grainger, through its Bridgewater Equity Release subsidiary and its partnership with Norwich Union, specialises exclusively in these plans.
- Lifetime mortgages enable home owners to borrow money against the current value of their home, which is paid back with interest on the eventual sale of the property. Grainger does not offer lifetime mortgages.
