Equity Release
Find out more about equity release and other forms of later life borrowing and whether one of them could be right for you…
After you’ve worked hard for years to meet your monthly mortgage payments, your home is likely to be your biggest asset. Hopefully you’ve also benefited from an increase in house prices over the past few decades.
The value of your home (minus any existing mortgage and other loans secured against it) is often referred to as equity. This equity is often passed on as an inheritance. However, an increasing number of people are tapping into the value of their property to help boost their retirement finances, enjoy the holiday of a lifetime or help their adult children get onto the property ladder.
If you’re wondering whether equity release is right for you, we’re here to help. This short article take you through the basics of equity release.
What is equity release?
Equity release is a way for homeowners aged 55 or over to release tax-free funds from their homes without having to move. With a lifetime mortgage (the most popular type of equity release), there are typically no monthly repayments to make as the loan, plus roll up interest, is repaid when the plan comes to an end. Usually, that’s when you, or the last remaining applicant, either passes away or moves into long-term care. With a lifetime mortgage, you’ll still retain full ownership of your home.
The money can be released to you either as a single lump sum or as an initial release amount, then further releases can be taken as and when needed, known as a drawdown lifetime mortgage.
With a lifetime mortgage, you have the right to remain in your home for as long as you choose, or until you move into full-time residential care or pass away. You also have the freedom to move to another property and transfer your loan without an early repayment charge (subject to the new property being acceptable to your lender at the time).
You will never owe more than the value of your home thanks to a no negative equity guarantee.
The money can be used for various things and is often used for…
- Repaying an existing interest-only mortgage
- Gifting to family or providing them with an ‘early inheritance’
- Home improvements
- Taking the holiday of a lifetime
Are you eligible?
Hundreds of thousands of people are already enjoying the benefits of cash they’ve unlocked from their homes. However, equity release may not be suitable for everyone, which is why it’s important to seek expert advice before you make a decision.
Could you be eligible?
You may be eligible for equity release if you meet the following criteria…
- You’re aged 55 and over
- You’re a UK resident
- You’re a homeowner with a property worth at least £70,000
Advice on later life borrowing
To ensure you receive the best possible advice, we have equity release experts who can advise you. We have partnered with Mortgage Advice Bureau to help you find the right later life mortgage. Equity release may be an option but there could be other borrowing solutions too.
To book a free consultation for you or a family member, please call Steve Dale on 07384 686223 or 020 8652 5240 or email steve.dale@mab.org.uk
Our trusted partner, Mortgage Advice Bureau, offers lifetime mortgages only. A lifetime mortgage is a loan secured against your home. Equity release will reduce the value of your estate and may affect your entitlement to means-tested benefits. Mortgage Advice Bureau offers lifetime mortgage products from a carefully selected panel of providers.
Unless you decide to go ahead, our service is completely free of charge, as our fixed fee of £995 is only payable on completion of a plan.
You should always think carefully before securing a loan against your property.