With an increasing number of retired people unable to meet their expenses on pension, equity release schemes are becoming one of the best tools to solve this area of need. It allows individuals to unlock the equity that they have built in their home, thereby assisting them meet the shortfalls in their financial affairs.
Equity release schemes allow homeowners to release the equity from their property to generate a tax-free lump sum or regular income. The money generated from equity release can be utilised to pay for home improvements, debt consolidation or to help meet the requirements afforded to a comfortable and luxurious lifestyle after retirement.
Retired persons over 55 years of age and having their own property are the ideal candidates for equity release schemes. With different types of equity release schemes available, you should choose the one that suits your requirements.
Types of equity release schemes
Two different types of equity release schemes are currently available – home reversion schemes and lifetime mortgages. As both schemes offer their own unique advantages, you must choose the best one.
Home reversion – This scheme allows you to live in your property till you die or move into long term care whether that is a retirement home or with relatives. However, you need to sell a part or your complete property to the reversion company. In return, the home reversion company will either offer you regular income or lump sum cash, depending on your requirements. The most popular form of release is the tax free lump sum option.
Lifetime mortgages – With lifetime mortgage equity release schemes, you will always have complete ownership of your property. By opting for a lifetime mortgage scheme, the need for making monthly repayments is completely eliminated. You can even continue to live in your property until you pass away.
If you are looking for a solution to retire without any worry, equity release schemes can be the perfect solution.
To chat to a specialist equity release adviser, contact the equity release team on 0800 678 5159.