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What is equity release?

In recent years, house prices have skyrocketed. The overall cost of living has also increased, making most people house-rich but cash poor. This means they have a huge value attached to their homes but don’t have liquid money to make life easy and comfortable.

Who is eligible for equity release?

To be eligible for equity release, you must fulfil specific requirements. These include: To qualify for lifetime mortgages, the individuals or the couple must be at least 55 years old. To be eligible for a home reversion plan, you must be at least 65 years old. Your house should be in a certain condition and have a certain market value.

How much can you borrow through equity release?

If everything is in place, you can borrow up to 60 per cent of the total value of your home. However, several conditions play an important role in how much money you can finally borrow. These factors include your age, your house’s worth, your health condition, etc. When taking out a product, your pay percentage typically increases with age.

Is equity release a good idea?

Equity release has been designed to provide homeowners with several safety measures for getting money. These include: The homeowners can stay in the house without paying any money until they pass away or move to long-term care. This kind of facility is unavailable if you avail of retirement interest-only mortgages.

What are the Advantages and Disadvantages of equity release?

Equity release can be a life-altering decision for you as it can make your life more comfortable and provide you with enough money to fulfil your needs and desires. Even though the popularity of equity release has increased a lot due to soaring home prices and plummeting interest rates, there are some downsides to it as well. It is important to know the disadvantages before you make a final call.