Solving fiscal and funding challenges
Governments, local councils, charities, religious institutions, not-for-profits and forward-thinking property developers often hold large portfolios of residential properties.
These assets, representing substantial and unproductive capital locked up over multi-year time horizons, until now simply could not be monetized.
Home equity is the last untouched asset class of sufficient size and depth of capital to make a real fiscal or funding difference.
So what is the problem? The issue is that there has simply been no financial instrument other than existing equity release mortgages (reverse mortgage, shared appreciation mortgages, shared equity mortgages and retirement income-only mortgages) capable of accessing capital within this asset class.
Our Equity Preservation Mortrgage™ equity release mortgage – a new type of equity release mortgage – monetizes home equity into home capital to create annuity income and new financial assets.
Futureproof’s low-risk fiscally responsible Equity Preservation Mortgage™ equity release mortgage can monetize up to 80% LTV of the home capital inti new financial assets – all with no depletion of equity.
Eligible residential property portfolios exclude public housing, but includes any of the following types of social housing:
- defense housing
- essential workers
- low income
- over 55 communities
- independent living
- emergency accommodation
- church properties
- community-based housing
- disability housing & group homes
- build-to-rent residential developments
For the owners or developers of these property portfolios, there is significant recurring funding required for on-going repairs and maintenance, utilities and outgoings or additional capital needed to add new residential properties to the portfolio to meet growing demand.
The institutional version of our Equity Preservation Mortgage™ equity release mortgage is a principal + interest version leaving nothing to repay at the end of the loan term. It is specifically designed to provide Governments, public entities, charities, religious institutions, NFPs and residential property developers, an annual drawdown of between 1.5% – 2.5% of the total asset value per annum of the property portfolio as tax-free annuity income for a minimum of 15 years – with no depletion of equity in the properties.
Using the institutional version of our Equity Preservation Mortgage™ in this way, enables governments and institutions to ease the fiscal burden of social housing and other owners of residential property portfolios to meet recurring expenses or fund new builds.