If you’ve accumulated more in your home than you paid for it, it’s worth considering the options available to you. One popular scheme is equity release – essentially a new type of mortgage that allows older homeowners to access the money locked up in their property without having to move or sell up. Cash Tied Up in Your Home With Equity Release.
How much cash can I release?
If you are over 55 and own your home, you could release up to 60% of its value with an equity release plan. The amount you can borrow is based on the value of your property, which will be determined by a professional valuation and your age (or the age of the youngest homeowner in the case of joint applications). Cash Tied Up in Your Home With Equity Release.
Typically, you will be able to take a lump sum or receive regular smaller payments. You may also choose to make ad hoc repayments if you wish, which will help reduce the amount of interest paid.
They can provide you with an indicative quote and put you in touch with an adviser if necessary.
How can I release it?
With rising house prices, many homeowners are now ‘house-rich but cash-poor’.
There are a number of different equity release plans.
If you’re thinking about equity release, it’s important to get specialist financial and legal advice. They should also be a member of the Equity Release Council.
How will I pay back the money?
You will normally have to pay a fee for this valuation. The adviser who arranged the plan will also charge an administration fee. You may also have to pay for a solicitor to complete the legal work.
Lifetime mortgages and home reversion schemes are regulated by the Financial Conduct Authority (FCA). StepChange Financial Solutions is an approved equity release adviser and is regulated by the FCA.
How will I protect my family’s inheritance?
Many equity release customers choose to ring-fence a proportion of their property’s value as inheritance for their beneficiaries. This can be particularly useful if the property has increased in value over time.
This can affect how much is left for your beneficiaries, so it’s important to speak to an expert financial adviser. They can review the impact of your chosen equity release plan on Inheritance Tax (IHT) needs read more hear.
