Equity Release Schemes

What is Equity Release?

Equity Release is a way of releasing money from your home without having to move. The equity in your home is the difference between what your property is worth and any outstanding debt secured against your house.

If you are a homeowner 55 or older you can release money from your property without ever having to make any monthly payments and because the equity is yours in the first place there is no tax to be paid on the funds you receive. With the Lifetime Mortgage equity release scheme you continue to own 100% of your home. At 65 and over the Home Reversion equity release scheme is available to you where you can sell a percentage of the property to the provider which will then guarantee leaving a percentage of equity to your beneficiaries.

There are three main types of equity release schemes and within each of these there are numerous products available. Below is a brief description of the equity release schemes available.

Lifetime Mortgage - you take a lump sum from the value of the property, with most of the products available there are no monthly payments and the interest is added to the capital, the loan is repaid when you pass away or if you move into long term care. There are a number of interest only lifetime mortgages available subject to affordability. For these equity release schemes you need to be 55 or over.

Drawdown Lifetime Mortgage - similar to the lump sum lifetime mortgage however the cash does not have to be taken in one go and is released when you need it, this added flexibility reduces the amount of interest that is accrued in that you will only pay interest on the money you need when you drawn this down. For these equity release schemes you need to be 55 or over.

Home Reversion Plan - with this type of plan you can sell all or part of the equity in your home for a tax free lump sum or a series of cash payments and you have the right to live in your home rent free for as long as you live and you will receive a legal agreement to confirm this. This is done by transferring legal ownership of the property to the provider and you are granted a lifetime lease. If you choose to sell just a part of the property you have certainty at the outset over a percentage of the property you retain being left to your beneficiaries. For these equity release schemes you need to be 65 or over.

At Equity Advice Line we will search the whole of the equity release market to find an equity release scheme that will suit you, to find out if you qualify and to receive a no obligation quote please call us on our freephone number 0800 085 3181.

next >>

What is Equity Release? Benefits of Equity Release How Safe is Equity Release? Why Choose Equity Advice Line?

Equity Release Schemes will reduce the value of your estate and may affect your entitlement to state benefits.
Equity Release may involve a Lifetime Mortgage or a Home Reversion Scheme. To understand the features and risks ask for a personalised illustration.
Equity Advice Line is registered in England and Wales, company Registration number 6391398, is directly authorised by the Financial Services Authority, FSA number 485022.
Our typical fee is £495 paid on completion and we will also be paid commission by the lender/provider. We also offer the choice of a fee only option where you will pay a higher fee and the commission paid by the lender/provider is refunded back to you. Consumer Credit Licence number 624653.