What is Equity Release?
Equity Release is the value of your home minus any outstanding mortgage. This can be described as your Equity. This is turned into cash giving you the freedom to spend it on whatever you like.
If you are a homeowner aged over 55 Equity Release could open up new exciting possibilities, for example, it can be used for:
• Release cash from your home and continue to live in the property.
• Tax free cash can be released as a lump sum, or an income or a combination of both.
• Top up your retirement income
• Pay off a mortgage, or help your children get on to the property ladder
• Pay off debts
• Buy a holiday home
• Inheritance tax planning
• Future holidays
• Home improvements e.g. adding a conservatory to your home
• Or just improve your lifestyle!
Types of Equity Release:
• Lifetime Mortgage - allows you to release a lump sum from the value of your property, with the amount released plus any interest accrued repaid out of your estate when you pass away or move into long-term care
• Drawdown Lifetime Mortgage - similar to a lifetime mortgage, but with added flexibility, as the cash can be released over time, as and when required, which can reduce the amount of interest accrued.
• Home Reversion Plan - you surrender some or all of the ownership of your property in exchange for a lump sum of money and the right to remain living in the house, rent free, for as long as you live.
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