Is equity release right for you?

With life expectancy increasing, more and more of us are getting to enjoy our retirement years with better health. Allowing us to do more of the things we love. But with the cost of living increasing, pension pots are becoming more stretched.

If you want to keep enjoying those little luxuries, whether it’s wanting annual winter sun, a bucket list holiday, or perhaps you’re hoping to fit a new kitchen with all mod cons, then taking out equity release on your home might be just the solution you’ve been looking for. 

What is equity release?

An equity release mortgage is a type of secured loan taken out against your home. Equity release companies are regulated by the financial conduct authority and can only be taken out once you’ve spoken with a financial advisor, so you’re fully aware of everything that’s involved with equity release. 

Are you eligible? 

Whilst you might find that every equity release provider has different eligibility criteria, typically if you are aged over 55, own your property, it’s worth more than £70,000, and you reside in England, Scotland, Wales, or Northern Island, then you may be eligible.

What can the money be used for?

Equity release funds are tax-free and can be used for any number of things, but is most commonly used for home improvements, helping to supplement income, as well as helping to pay for long-term care.

However, gifting money from equity release is being used increasingly as a way for older relatives to share their wealth with loved ones. 

You can also use the money to help with any additional debts. 

Can you still sell your house?

Yes! When you release equity from your home, you still own the property, you’ve just taken out a secured loan against your home. If you do sell your home, a lifetime mortgage acts like a regular mortgage and it can be ported – i.e., it can be transferred to your new property. 

How does equity release get paid back?

Typically, the loan will be repaid from your estate following the sale proceeds of your home. 

Unlike traditional mortgages, equity release mortgages in the form of a lifetime mortgage do not have any timescales for when it needs to be paid back. This means that it is possible to pay off the equity release loan early, however, there may be an early repayment fee. 


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