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Can you get an equity release mortgage with an annex?
There are equity release mortgage lenders that can consider properties that have an annex.
Lenders all have their own criteria when it comes to applicants and properties.
As a result, equity release lenders may not accept the property as security for the loan if it has an annex.
Equity release lenders will need to know more details about the annex, such as whether it is internal, or external to the house, has its own entrance and who is living there.
For lenders that can consider houses with annexes they would usually insist that the annex is to be occupied by the owners or family members.
If the annex has a separate address or its own utilities, this can also make it harder to get a lifetime mortgage on the property.
You should speak to an equity release mortgage adviser to give them full details of the property, and your individual situation.
Lifetime mortgages will not be suitable for every person, so make sure that you take professional advice and do your due diligence before entering into an equity release product.
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Will all equity release lenders lend on a property with an annex?
Not all equity release lenders will accept a property that has an annex.
Lifetime mortgage lenders can be quite particular about the properties that they consider, as the loans are designed to be in place for a long time.
This means that properties close to commercial buildings or with flat roofs, may be more difficult to place with a lender, than a standard house in a quiet street.
Equally, an annex on a house is an additional factor for a lender to take into account, making the property non-standard. As a result, it may reduce the amount of lenders available in the market when you come to submit an application.
It will be for an equity release mortgage adviser to understand full details of the property, and advise accordingly based on lender’s criteria at the time.
I plan to rent the annex out? Would I get my equity release mortgage?
If you have an annex on your property, and plan to rent it out to people outside of the family, it is unlikely that a lender will give you an equity release mortgage.
Equity release lenders usually require the property to be occupied by the borrowers and their families.
If there are tenants or lodgers within the property on tenancy agreements, this will often lead to a lender being unwilling to accept the equity release application.
Adult occupiers of the property are usually asked to sign occupier consent forms which would not be signed by tenants.
There are however lifetime mortgages that allow buy to let properties, but this is different to an element of your own home being rented out.
If you are in this position, due to lenders making regular changes to their products and policy, it would be worth contacting an equity release mortgage adviser to explain the situation.
They may be able to find an option for you once they have all details.
Should I use a mortgage adviser for an equity release mortgage?
If you are planning on taking an equity release mortgage, professional advice is very important.
Lifetime mortgages are not designed for short-term use. As a result, going ahead with one is a big decision to make, so you should only do so when you have fully understood the products available, and alternative options.
It may be that there is a more suitable solution for you that does not involve equity release mortgage.
If so, you should explore this in addition to looking at which equity release products are available.
Make sure that your mortgage adviser is regulated by the Financial Conduct Authority, and ask if they are a member of the Equity Release Council arranging lifetime mortgages on a regular basis.
Most equity release mortgage advisers will be willing to give you a free consultation in order to explain your options.
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Conclusion
It is possible to get an equity release mortgage on a property with an annex. However, not all lenders will offer this, and the use of the annex is also very important.
You should tell your lifetime mortgage adviser full details of your situation, and more details about the annex, so they can carry out some research.
Make sure that you only use a lifetime mortgage adviser that is regulated and able to tell you all options available to you.
If you would like I NEED ADVICE to match you with an equity release mortgage adviser that can explain how the products work, please complete the contact form.
They are experienced, which can boost your chances of being approved.
