Equity Release
Equity Release Mortgages
Lifetime Mortgages
If you are in your mid-50s or older, own your own home and want additional funds, then releasing the equity in your property through a lifetime mortgage may be a way of achieving this. There are various types of lifetime mortgage available and will generally involve taking out of a mortgage secured against the value of the home in order to provide a cash lump sum, regular income or both.
These schemes can be helpful in certain circumstances but are not suitable for everyone. There are advantages and disadvantages involved and it would be prudent to seek professional advice before committing yourself. It is important that you consider all the options available in order to be sure you take the most suitable action for your own needs and circumstances.
This is also an emotional subject for families and we would recommend that all involved discuss the options in great detail with us before making a decision, especially in deciding as to which option is more suitable, this or the Reversion Scheme.
Reversion Schemes
This involves the reversion company purchasing or arranging for someone else to purchase some or all of your property. You get the sale proceeds as a cash lump sum, although with some schemes the lump sum is invested to generate a regular income. Since the reversion company cannot re-sell the property until the earlier of your death or you move out, you will receive less than the market value for the percentage being purchased - typically 35% - 60%.
Generally speaking, the older you are when you start the scheme, the higher the percentage of the actual market value you'll receive for the portion of the property you are selling. When the property is sold, the reversion company receives the same percentage of the sale proceeds as that which they originally purchased. Your estate benefits from any rise in the value of any part of the property you may have retained.
Again this is also an emotional subject for families and we would recommend that all involved discuss the options in great detail with us before making a decision, especially in deciding as to which option is more suitable, this or the Lifetime Mortgage