Joseph said that the ‘want’ borrowers, often wealthier and gifting to children with one eye on inheritance tax savings, are now less likely to do so given that today’s rates are higher than they were 12 months ago. If you are a couple, the repayment is not made until the last remaining person living in the home either dies or moves into care. This means you both are free to live in your home for the rest of your lives. If you are thinking of taking out an Equity release plan then you need to find out as much as you can about your options. You can then weigh up the advantages and disadvantages fully before you decide if it is right for you.

As a result, there has always been a demand for equity release schemes involving high-value properties. Equity release schemes have become even more popular due to uncertainties in the market and challenges such as Brexit, which have reduced overall investment returns. Interest rates for lifetime mortgages have fallen significantly over the last 15 years, but even these low rates can result in large amounts being owed due to the effect of compound interest over a long period of time. The second – and much less common – option is a home reversion plan. Rather than borrowing against your property’s equity, you sell all or a portion of your property at below market rate to the provider.

You’re mortgage-free or only have a small mortgage.Your remaining mortgage will have to be paid off as a condition of taking out an Equity Release product. You can do this from the amount you release if there is sufficient scope to do so. You must live permanently in your home.The property must be your main residence and not left unoccupied for more than 6 months at any one time.

Equity Release Council ‘How to access property wealth in later life’. how does equity release work ’s benefits calculator will provide an estimate of what benefits you could be entitled to. When the local authority conducts its means test, it may look at the equity you have in your home as well as any savings you have. There is also a type of mortgage specifically designed for the over 55s called a Retirement Interest Only Mortgage , which works much like a traditional mortgage but with greater flexibility in terms of how it is repaid.

Think Plutus can help you find the best possible deal to unlock equity from your home to spend as you choose. If you still have a large lump sum from your Equity Release in the bank, or if you are receiving regular payments from it, this could mean you are asked to pay a bigger proportion of the care costs. Equity Release can be used to pay for care, either by releasing a large initial lump sum or by taking regular smaller lump sums to pay for the fees as you go.

Each Equity Release provider uses their own LTV scale and this is taken into account by your Financial Adviser when recommending a product for you. The value of your home, your age, and your health all play a big part in how much you may be able to release. Other factors will affect how much you can get, including the options you require, and whether you want easy access to a further drawdown fund. Our friendly and experienced team have your best interests at heart and will search a broad range of providers to find the right Equity Release solution for your individual circumstances. What do you expect of the equity release market over the course of 2023? “This is because there has been a shift in the types of homeowners looking at equity release, for example, and what they plan to use the released money for,” he added.

Instead, the lender will roll-up interest against the loan, meaning that the amount owing will increase over time. The loan only becomes repayable when the last borrower dies or moves into Long Term Care. Solicitors Solicitors work on both sides of an equity release contract and consumers and providers must each have their own legal representation. Please note that all views, comments or opinions expressed are for information only and do not constitute and should not be interpreted as being comprehensive or as giving legal advice. No one should seek to rely or act upon, or refrain from acting upon, the views, comments or opinions expressed herein without first obtaining specialist, professional or independent advice. While every effort has been made to ensure accuracy, Curtis Parkinson cannot be held liable for any errors, omissions or inaccuracies.

It’s great that all these choices exist, but this can often make it more confusing to know which option is the right one for you. Our experienced Equity Release Financial Advisors can help you understand all your options and will advise you on the most suitable solution for your specific needs and circumstances. This is on a sliding scale typically getting higher as you get older.

It’s a bit different if you’re moving from a freehold property to a leasehold, or property of lower value, as you may need to repay part of your Equity Release. Pay one-off private medical bills, or receive ongoing care at home. Adapt or enhance your home, so you can continue to live independently. This will be the case, even if you include an inheritance protection guarantee.