The Benefits of Equity Release
Equity release schemes that are regulated by the FCA can be a safe way to access some of the equity tied up in your property. This tax-free cash can be taken as a lump sum or in instalments, and the best thing is it can be used however you want.
The advantage of equity release is that it gives you money to spend now, rather than leaving it locked away in your home. Rising house prices in the UK means that a large proportion of homeowners’ wealth is tied into their property, and inaccessible.
If your home has increased in value over the years, equity release can help you access some of that money to supplement your retirement income – instead of leaving it all to your beneficiaries, or to cover your long-term care costs.
Equity release isn’t right for everyone, there are positives and negatives, and careful consideration is vital to ensure it is a suitable option for your individual circumstances.
You will have tax-free cash to spend on what you choose
You won't have to pay tax on the money you release. You could use the money to:
- Pay off your mortgage or debts
- Make improvements on your home
- Top up your income and live more comfortably
- Help loved ones
- Pay for something for yourself, like a holiday
- Spend on whatever you want
The main advantages of equity release
You can continue to live in your own home, rent free, for the rest of your life or until you move into residential care.
The ‘no-negative equity guarantee’ means that you will not have to repay more than the value of your home and that your estate will never owe more than the property is worth when it is sold.
The tax-free cash that you release can be used on anything you choose, from home improvements, paying off a mortgage or debt, or for a holiday.
The flexibility of modern equity release plans means that you can release the money as a lump sum, or a lump sum with a drawdown facility.