Wealth in family home as 'fourth pillar of retirement income system' may help seniors struggling with debt

Senior homeowners may be able to clear their debts and reclaim their lifestyle if they can access the equity in the family home as a lump sum ‘debt free’, according to a leading equity release provider.

Recent reports show more seniors are struggling financially: the government-run National Debt Helpline reports more enquiries from older Australians who can’t repay their debts, including home loans. The Salvation Army’s Moneycare financial counselling service has also seen a big increase in over-55s in what is termed ‘severe debt’.

Homesafe Solutions Pty Ltd, the provider of Homesafe Wealth Release^®, says it is seeing more interest from senior homeowners who wish to use equity release to eradicate their debts.

Dianne Shepherd, Chief Operating Officer and General Manager of Homesafe said the wealth built up in the family home has become the fourth pillar of the retirement system in Australia. “It’s important for seniors, today and in the future, to have access to products which can provide the ability to access this wealth when needed the most.

“More seniors are being constrained by debts including home loans and personal loans, and wish to reclaim their lifestyle.

“Debt free equity release can be powerfully effective in this aim by providing a lump sum to eliminate those debts and avoid the problems with capitalising interest.”

Homesafe Wealth Release^® has been designed to provide older homeowners a mechanism to access the wealth in their home, by providing the homeowners an upfront lump sum payment, in such a way which addresses future uncertainty.

Homesafe Wealth Release^® is a property transaction and not a loan, which enables the homeowner to sell a capped future share of the eventual sale proceeds of their home in return for a cash amount today whilst retaining the right to live in the home and choose when they sell. The capped share approach, provides greater certainty by ensuring the homeowner is not burdened with property growth, longevity or interest rate risks, as may be evident in alternative equity release products.

For over 13 years Homesafe Solutions Pty Ltd has provided its debt free equity solution via its customer centric, ‘one-on-one’ approach to customer service, and has built a respected reputation in the market by providing a facilitation model without sales staff or selling strategies.

“Homesafe Wealth Release^® has been designed to offer a solution which can protect the future equity in the home”. Ms Shepherd said.