Equity Release
When considering the Equity Release, there are a number of points to take into account.
I have pulled together a few of the pros and cons of Equity Release in short blog post which should be helpful to anyone considering one of these products.
What's it all about?
Essentially, Equity Release is a way of releasing the cash ‘tied up’ in your home, without having to actually move out. There are a number of different products available to homeowners, (usually available to those over the age of 55).
How does it work?
The two main types of scheme available are the Lifetime Mortgage and the Home Reversion plans. Both schemes have advantages and disadvantages.
The Lifetime Mortgage scheme is the most popular scheme in use in the UK. This is basically a loan secured against your property like a regular mortgage however you don’t pay anything back until you die or are taken into long term care.
The Home Reversion scheme involves you selling all or part of your home. You can use the equity released buy a regular income, cash lump sum, or a combination of the two.
Is It For Me?
Equity Release is not suitable for everyone, and it’s important to get sound financial advice before proceeding. You’re also unlikely to be accepted if you still have a large mortgage outstanding on your property.
Regulation
All companies offering such products can be checked out on the FCA Register. The Financial Conduct Authority regulate the financial services offered by companies to make sure that they are giving correct advice and not misleading and mis-selling policies to customers.
You can check the FCA Register here
