Equity release can allow cash poor but property rich people to free up some much needed capital that is stored in their property. Seeking professional advice on equity release is also a great way to determine whether or not such a move will be a viable option, as it should be considered an important, life changing decision.
There are two types of equity release and they are known as:
- Home Reversion equity release plan – you can sell a percentage of your property to your financial provider and receive payments either as a lump sum or regular income.
- Lifetime mortgage equity release plan – you can take out a loan on the value of your property usually in the form of a lump sum.
These agreements are generally intended for people who have repaid the entirety of their mortgage loan. What with reductions in annuity plans and the rising cost of living, it is now more important than ever to be savvy with your finances. You may wish to seek financial advice about equity release to see if it is a good option for you.