Equity Release - a later life solution for you?
For those who are unfamiliar, equity release can offer a solution for people to cash in on their home while still living there. Aimed usually at those aged over 55 and above it can offer a means of borrowing money in the run up to and after retirement, using your home as security.
Equity release has surged in popularity in recent years, having had very poor press in the past. It is generally used for a variety of reasons – to supplement retirement income, fund later life care or home improvements or to pay off debts or a mortgage shortfall.
All sound too good to be true? It is vital that before rushing in, proper professional advice is sought and you thoroughly explore all other alternatives – these might include a traditional mortgage extension, an unsecured loan or even downsizing.
Equity release can offer a solution but fees are generally high and the debt taken out can quickly escalate. Depending on the growth in your property value this could wipe out most of your equity and how much can be passed on to family when you die. This may not be an issue in some families but it will in others and it can be useful to discuss any plans with close family generally, before committing.
Lenders can look at the age of a property, its construction and location – all of these factors will have a bearing on what, if anything, can be borrowed.
Although becoming increasingly popular and with availability widely advertised in the media and in the national press, equity release can offer a ready solution but is not for everyone and caution must be exercised.
Should you wish to discuss further then please contact the solicitors within our property team.