Equity Release Explained

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Equity release is where you can release money from your property without having to move or sell your house. You can access the fund as a lump sum or set up an equity release drawdown facility depending on what type of plan you choose. There are no monthly repayments, the interest rolls up and is only payable when the property is sold.

Equity release lenders now give homeowners aged 55+ the option to turn the equity built up in their property into tax-free cash without selling up or downsizing. You continue to own the property 100%, keep the deeds in your name and have the right to remain in your property for life.

Equity in your home is the difference between the home’s fair market value and the outstanding balance of all mortgages, secured loans and charges on the property. Usually, to access your equity you would need to sell your property or remortgage with straining monthly repayment commitments.

However, equity release is a product designed to meet the needs of asset- rich homeowners who don’t want to move. It’s popular because it makes sense. The equity release lenders like to invest in reliable, long-term UK property whilst those releasing equity benefit from gaining access to money that would have otherwise been tied up for life.

The money you receive is yours to spend as you please and as the equity is already yours, it is completely tax-free. You can also choose how you would like to receive the money – whether it be a cash lump sum, an account to draw upon as and when required, or a mixture of the two. Each have their own value so it’s best to look at all the options and compare them all with the help of comprehensive advice.

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If you release equity with the lenders I select, you are guaranteed to keep ownership of your property and you are guaranteed to be able to live there for the lives of you and your partner or for as long as you want to.

With our modern form of regulated, flexible equity release, called a lifetime mortgage, you get on-demand access to this wealth in a flexible, safe way without having to sell your property, give up ownership or move.

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If you’re 55 or over (youngest age if a couple) and own your own home in the UK, then you could be eligible for an equity release plan.

If you are taking out an equity release plan jointly (whether you are married, in a civil partnership or cohabiting) then you must both be 55 or over. Your spouse or partner will then have the right to live in the property for as long as they want, should you pass away or move into long-term care.

You must also own your property and it needs to be valued at £70,000 or more. The property must be in the UK (including Northern Ireland), it should be your main residence, be of standard construction and in good condition. If it’s leasehold then it must have at least 75 years remaining on the lease.

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The answer is No. You are guaranteed to keep the deeds to your property and maintain 100% home ownership.

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Yes. You can transfer the plan to another suitable property without penalty. If you decide to downsize in the future, you can repay the plan with the proceeds of the house sale. There may be charges for paying back early but if this was a priority I would find you a lender who was the most flexible with repayment. This is a lifetime mortgage. To understand the features and risks ask for a personalised illustration.

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