How To Release Equity From your House

Release Cash From Your Home

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Finding  the right equity release plan for your personal circumstances couldn’t be simpler

See below for a range of selected offers from leading UK equity release providers

Equity Release Plan: Classic Super Lite

Features: FREE Valuation

Equity Release Calculator »

Equity Release Plan: Flexi Choice Super Lite

Features: FREE Valuation

Equity Release Calculator »

Equity Release Plan: Classic Drawdown Lite

Features: FREE Valuation

Equity Release Calculator »

Equity Release Plan: Premier Flexible Black

Features: Cashback & FREE Valuation

Equity Release Calculator »

Equity Release Plan: Flexible Pink

Features: Cashback & FREE Valuation

Equity Release Calculator »

Equity Release Plan: Lifestyle Flexible

Features: Cashback & FREE Valuation

Equity Release Calculator »

Equity Release Plan: Flexible Lifetime

Features: FREE Valuation

Equity Release Calculator »

Equity Release Plan: Capital Select Lite Flexi

Features: FREE Valuation

Equity Release Calculator »

Equity Release Plan: Select Lite Flexi

Features: FREE Valuation

Equity Release Calculator »

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If you are retired or thinking of retiring you might have been looking into ways of raising some funds to make yourself more financially comfortable. One such way is unlocking some of the wealth tied up in your property with an equity release plan.

Types of equity release:

There are two main types of equity release plan.

Lifetime mortgage

A lifetime mortgage works by taking out a loan for a percentage of your home’s value, typically up to 56%. You don’t have to make any repayments on this loan instead when you die or move into a residential care home the loan is repaid along with any interest on it through the sale of your home.

There are three different types of lifetime mortgage:

  • Roll-up – In a roll-up mortgage there are no monthly or annual repayments at all the whole amount you originally plus the interest that has accumulated on it is repaid through the sale of your home.
  • Interest-only – Interest only mortgages gives you the option to make monthly payments on the interest on your loan, the original sum borrowed is still repaid through the sale of your home.
  • Fixed repayment – in a fixed repayment plan you don’t need to worry about interest. During your application process you will agree with the lender how much more will be repaid to them through the eventual sale of the property.

Home Reversion

Home reversion is an alternative to lifetime mortgages. With a home reversion scheme you sell your property for less than its market value for either a lump sum or regular ‘income’ payments. In return the home reversion company will guarantee you the right to continue living in your home indefinitely until you either die or move into a care home. Some providers will ask you to pay a monthly rent but this will be at a reduced rate, others will allow you continue to live in your home for free.

Equity release is available to UK homeowners aged between 55 and 95 and allows you to release capital from your home. The money released can be used for any purpose, and can be taken as a tax free lump sum or in smaller amounts if preferred.

Key features include:

  • Available to homeowners aged 55 to 95
  • Release capital tax free from your home
  • You choose how to spend the money
  • Lump sum & drawdown options
  • You cannot release equity without taking advice

You can release equity from your home with either a lifetime mortgage or a home reversion scheme. The most popular type of equity release is a lifetime mortgage, where a loan is secured against your home & you retain full ownership of your home.

Key features include:
  • The amount you can release will depend on your age
  • The minimum age you can be is aged 55 with 95 as an upper limit
  • The minimum property value on which an equity release plan can be secured on is £70,000
  • The older you are and the higher the value of your property the more equity you can release

When capital is release by the plan provider, instead of making monthly interest repayments, interest is usually added to the loan. this is known as compound interest. At the end of the plan (usually when either of you pass away or move into long term care) your house will be sold & the equity release plan provider will be paid back from the house sale proceeds with the balance paid to your estate.

 

There are different types of equity release plan and can be summarised as follows:

Lump sum lifetime mortgage
  • Provides a tax free lump sum secured against your home giving you access to a pot of cash.
  • Funds released can be used for almost any purpose
  • You retain full ownership of your home
  • Interest rolls up and is added to the loan. Typically repaid when you pass away or move into long term care
  • Some plans allow you to guarantee  a percentage of the future value of your home for your loved ones’ inheritance. Other options include the option to pay monthly interest
  • You need to take advice before you can take a lifetime mortgage out
Drawdown lifetime mortgage
  • Lets you drawdown cash in stages after an initial lump sum
  • You will only pay interest on the funds drawn down
  • These plans are more flexible so you do not miss out on means tested benefits
  • Drawn down funds can be used for any purpose e.g. home improvements, pay for university fees
Home reversion plan
  • Need to be aged 65+ to qualify
  • Involves selling all or part of your home for a tax free cash lump sum
  • The money you receive can be used for any purpose
  • Your share of the property will benefit from house price increases
  • When you pass away or sell your home, the home reversion provider takes its percentage from the sale proceeds.

For a quick estimate of what you could borrow use the link below:

Equity Release Calculator »

A lifetime mortgage is a loan secured against your house that allow you to release some of the equity you have built up.

Also known as equity release mortgages, like retirement interest only (RIO) mortgages they are only available to over-55s, and the loan is fully paid off when the last person living in the property dies, sells the home or goes into care.

The main difference is that RIO mortgages require borrowers to pass affordability checks and commit to making regular payments for life. With an equity release plan there are no such checks required.

There are a number of variables that can determine how much you may be able release from your home.

The key thing are your age and the value of your property.

The table below provides an approximate indication of how much equity you can expect to release from your home depending upon how old you are from a lifetime mortgage (Home Reversion Plans may offer a higher amount):

 

AGE     % OF EQUITY RELEASE
55 25
56 26
57 27
58 28
59 29
60 32
61 33
62 34
63 35
64 36
65 37
66 38
67 39
68 40
69 41
70 42
71 43
72 44
AGE     % OF EQUITY RELEASE
73 45
74 46
75 48
76 49
77 50
78 51
79 51
80 52
81 52
82 53
83 53
84 54
85 54
86 54
87 54
88 54
90 54

Lifestyle factors can also come into play, so if you are a smoker or are overweight the amount you can release may be increased.

For a quick estimate of what you could borrow use the link below:

Equity Release Calculator »

FREE & no obligation – Equity release service

Equity Release Quotes >>

THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Equity release may affect your entitlement to state benefits and will reduce the value of your estate. It may involve a lifetime mortgage or home reversion plan. All content set out in this website is provided for information only and should not be considered as advice. It is strongly recommended that you seek advice of a qualified, independent financial advisor before making any decisions to take out an equity release product.

Equity Release

Unlock Cash In Your Home

Equity Release Service

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YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE