What is Equity Release?

What is Equity Release?

In short, Equity Release enables home owners to access the equity that has built up in their house without the need to move or downsize.  The payment is paid as a loan from a Lender and, although there are different products on the market, the loan is ultimately paid off when the house is sold (usually when the homeowner dies or when they need to enter long term care).

How Equity Release products work

Within the regulated market there are two main categories of products available: Lifetime Mortgages and Home Reversion Schemes.

A Lifetime Mortgage is designed not to be repaid until the house is sold.  Usually, the interest ‘rolls up’ over the lifetime of the mortgage. Unlike a traditional mortgage, there are no monthly repayments, however you can choose the repay the interest each month.  The tax free loan can be paid to you either as a lump sum or in smaller regular payments.

Home Reversion Plans allow you to sell all or part of your home to a Lender who will recoup any money lent when the house is sold. There are no interest payments/roll up.  Your home remains yours and there is no day to day interference or restrictions on your house, except that you should keep the home in a good condition.

Eligibility for Equity Release products

Eligibility varies for each lender, however basic criteria requires the youngest home owner to be aged 55 or over (although some schemes may require a higher age). Your house should be worth at least £70,000, in good condition, situated in England, Scotland or Wales and be your main residence. The home owner should have little or no mortgage outstanding on the property and that any mortgage they have, will then need to be paid off with the funds gained from equity release.

How we can help

Equity Release products will not suit everyone.So at Frimley & Basingstoke offices we have qualified Equity Release Advisers who have a great depth of knowledge concerning Equity Release. We think it’s important to take the time to understand your circumstances and your reasons for taking out these products and help you to identify if there are different or more suitable options for you.

Our Equity Release Guide provides further information about Equity Release products, the process and everything you should consider before making a decision.

All your initial consultations are free and we can arrange to meet you, at a time that suits you, at our offices or in your home if that is more comfortable for you.

After your free consultation, you may request we proceed to apply for your equity release product. Our typical fee is £1495 on completion.

To discuss without obligation, do not hesitate to contact us by telephone, email or by completing the form on our Contact page. We look forward to hearing from you.

Free Equity Release Guide