Pure Retirement is headquartered in Leeds and is the first equity release company to open its doors in recent years. The company started operating with lifetime mortgage options in 2010. As a new company they provide equity release options with transparency and within UK regulations set by the Financial Conduct Authority and Equity Release Council.
Types of Plans
Pure Retirement has two plans: drawdown and Pure Lump Sum Plan. The drawdown plan provides a cash reserve facility to withdraw from when necessary. The Pure Lump Sum Plan provides one lump sum with no special account for withdrawing further funds.
Applicants can live in England, Wales or mainland Scotland to apply for one of the Pure Retirement Plans. Pure Retirement requires homeowners to be at least 70 years of age with a minimum property value of £70,000. For the drawdown mortgage homeowners must take £25,000 as an initial lump sum. Pure Retirement offers a higher LTV (loan to value) percentage. Their plans begin by offering 36% and will increase as age increases. The drawdown plan allows for minimum withdrawals of £5,000 when a homeowner requires more.
Depending on which plan homeowners elect there can be some inheritance protection based on the amount of funds actually used. The drawdown plan, while it will incur interest, will only increase with the more funds taken. The initial sum can remain the same with interest building and leave some home equity in the home depending on appreciation or depreciation occurrences during the life of the homeowner. It is at death that the repayment for principle, subsequent funds, and interest will be made. If the home is sold for more than what is owed the funds are given to the beneficiary.
Homeowners can elect to remain in their home until death or should long term care be needed on a permanent basis, a homeowner will need to make repayment.
Pure Retirement Calculator
Options to Add to Equity Release
For repayment there are early repayment charges in the first few years.
Protection under the Government
In accordance with the Financial Conduct Authority and Equity Release Council’s Code of Conduct, Pure Retirement Plans have a no negative equity clause. This clause states that once the home is sold to repay the loan, no other assets can be seized by the lender. If the home value does not cover the principle balance and all interest the lender cannot require other assets to pay the amount in full.