Equity release products are typically available to people aged 55 plus who own a UK property.
The most popular types are Lifetime mortgages and drawdown Lifetime mortgages.
With a Lifetime mortgage, you receive a lump sum typically between 18% and 60% of the value of your property.
Did you know, equity release is commonly misinterpreted as selling part of your home to fund the arrangement. This is not the case!
There are no interest payments and home ownership is maintained. Interest is rolled up and payable when you and your partner die or go into long term care.
With a Lifetime drawdown scheme the terms are the same however you are able to take cash sums when required. Interest is only charged on the actual sum taken.
As with all mortgage products there are a vast range available to suit your circumstances that is why it is vital to obtain independent financial advice. With government plans to perhaps cap long term care or introduce some form of death tax an equity release product is in no way a case of ‘having your cake and eating it too’ however it does give the homeowner the choice of creating an income or giving your children a helping hand in your lifetime.