What is Equity Release
Equity release enables homeowners who are aged over 55, to release cash from their properties while being able to continue to live in their homes until they pass away or enter long-term care.
These schemes are a range of products often referred to as a Lifetime Mortgage, Equity Release Mortgage, or Home Reversion Plan. All these schemes allow the homeowner to raise tax-free capital against the Equity in their home or homes, below we go into more detail but for expert advice you can give us a call. We would be more than happy to talk through the different type of products available.
Lifetime Mortgage
One of our more popular products is a Lifetime Mortgage, it is available to those aged over 55 and are used to release cash from your home by taking out a Lifetime Mortgage, which is a loan secured on your property that does not need to be repaid until you die or go into long-term care. A Lifetime Mortgage enables you to obtain a Tax-Free Lump Sum from your home while you continue to live in it.
Home Reversion Plan
A Home Reversion Plan is available for the over 60’s and it involves you selling all or a percentage of your property in exchange for either a regular income, a lump sum or a mixture of both. A Home Reversion Scheme allows you to stay in your home as a tenant but pay no rent.
As an example, if you sell 50% of your property to a Home Reversion Provider, and the property was sold, the Home Reversion Company would keep 50% of the proceeds. A Home Reversion Scheme is just one form of an Equity Release Scheme we offer, and our staff will advise you on the best type of plan for releasing equity in your property to suit your individual circumstances.
Lifetime Mortgage or Home Reversion Plan
While Lifetime Mortgages are the most common form of releasing equity in your property, Home Reversion Plans can be more suitable for some people. We appreciate that everyone’s circumstances are different, here at Thomas and Co we will take the time to explain in detail all the options available, and help you decide which type of scheme is best for you.
What is Equity Release for The Over 55’s
Equity Release for the over 55 allows homeowners to release tax-free cash tied up in their home. The amount of equity which would be released is based on your age and the value of your home. Provided you are over 55, we have a variety of plans to help you and deal with all the major Companies that allow you to release equity in your property. Money raised could either be as a lump sum, regular lump sums or a combination of both.
Is Equity Release a Good Thing?
It can be a good thing for those needing extra cash in later life. Money raised via a Lifetime Mortgage or Home Reversion Plan could be used for any reason you choose such as, paying for home improvements, helping family members, repaying debts, or simply topping up your income. Customers should be aware that releasing equity will devalue your estate and reduce any inheritance for your family.
Pitfalls of releasing equity in your property.
These schemes will certainly give you cash and/or regular income, however, the downside to any plan is that the money released will need to be repaid when you die or enter long-term care which will impact the value of your estate when you pass, this may be exactly what you want or need, however, to find out all of your options and get expert mortgage advice on releasing equity in your property, please feel free to give us a call.
What can the money be used for?
Money raised by Equity Release is not only tax-free but could be used for anything you need. Here are a few ideas and what our clients Commonly use the money for:
- Help family
- Repay Debts and Settle Mortgages.
- Purchase New Properties
- Home Improvements
- Holidays
- New Cars
- Care Needs
- or simply to supplement their income.
How much cash can I raise with Equity Release?
As a rule, the maximum equity which could be released from a property is 59% of its value, other factors that could reduce this would be your age and property condition.
| Age | Amount of Equity |
| 55 – 59 | 33 to 44% |
| 60 – 69 | 39 to 50% |
| 70 – 79 | 50 to 55% |
| 80 + | 57 to 59% |
This table provides an indicative guideline based on mortgages arranged by our panel of lenders. To obtain a formal quotation of the equity you could achieve please get in touch on 01455 238 650 or complete the form opposite to have one of our staff call you back directly.
Something else that might interest you.
Income Protection
Income Protection is designed to pay out a regular monthly monetary amount to help cover your expenditure should you be unable to work.
What does Income Protection Cover?
The Insurance will pay out a regular, reduced income in the event you are unable to work due to an accident, illness or in some circumstances made redundant.
Some policies will continue to pay a regular reduced income if you are unable to return to work up until the end date of the policy which is typically your normal retirement age. Visit Income Protection Cover.
