Why should you consider Equity Release?

What is Equity Release?
Put simply, Equity Release is where you can release equity (money) tied up in your home for any purpose you like. If you or someone you know are over 55 this could be a brilliant way to improve the quality of life in your retirement years and help prevent any financial concerns when you’re no longer working full-time.

Different Schemes
There are schemes to suit everyone. You can choose to make monthly repayments to the lender or not. Either way the outstanding balance is not due for repayment until you either pass away or move into long-term care.

Reasons for Equity Release
Below are some of the most popular reasons why people take out equity release:

  • Home and garden improvements
    Research conducted by Legal & General Home Finance shows that over 50% of equity release was used for home improvements. 
    Getting older can mean you may need to make adaptations in your home to enable you to keep living there. These improvements can be more affordable and less hassle than moving house. Improvements can include, carrying out a loft conversion to increase the value of the house, installing a new kitchen, and putting in a downstairs toilet to improve accessibility.

  • Paying off debts
    Many people release equity from their home so that they can pay off any debts such as a previous mortgage, car loan, or credit card.

  • To help family members financially
    It is common for people to choose to release money tied up in their home to help their children. Some use it to pay for their children's further education whilst others like to use the money to help their children onto the property ladder. Many prefer to help their children out whilst they are still alive rather than leaving them money in their Will so they can see the difference they have made to their lives.

  • Holidays and other luxuries
    Some people decide to use the funds released for 'large ticket' items such as holidays or car purchases. In many cases, equity release can mean you can live to the fullest whilst still living in your own home. 

Talk to a Mortgage Adviser
It is important to speak to a Mortgage Adviser who is a member of the Equity Release Council as they can help you to make the right decision for your individual needs. 

Recent posts

The government has announced plans to make buying or selling a home cheaper and quicker with what is being called the “biggest shake-up to the homebuying system in this country’s history.”

Almost one in five equity release mortgages are now taken out to provide financial support to family.

According to industry data, the expected wait for those looking to buy a property has dropped from just over 11 months to less than six months.

It is common for your first mortgage payment to be higher than your subsequent monthly payments for two reasons.

Firstly, a big congratulations, you’ve now exchanged contracts! After weeks and months of waiting, you are about to move in. What should you do first?

The chancellor will deliver her second budget this autumn. Due to slow economic growth and high inflation, the government need to manage a £40 billion shortfall in public finances. There have already been reports about changes to taxes including income tax and capital gains tax.

The chancellor has advised that landlords could have another tax to pay this autumn as the Treasury decide whether to extend national insurance contributions to rental income. 

According to a report in the Guardian, senior ministers have asked Treasury officials to look into a “proportional” property tax to see how it would work as an alternative to the existing stamp duty land tax on owner-occupied homes.