By Isle of Wight Observer
Equity is what is left over if you were to sell your property. So it is the value of your property, less any mortgage or loan over it.
Equity release enables you to enjoy the equity/monies stored up in your home during your lifetime. Whilst staying in your own home, you are afforded some financial flexibility perhaps to have a wonderful holiday, carry out work to the property or make gifts to loved ones.
There are two main types of equity release scheme available, a home reversion plan or lifetime mortgage.
A home reversion plan means that all, or perhaps part of your home, is sold to a private company. In return you would get a cash lump sum, an income or sometimes both. You would stay in your home rent-free or for a small monthly rent until the property is sold. When the property is eventually sold the private company would receive the proceeds of the sale depending on the share of the property that you sold.
A lifetime mortgage is loaned against the value of your home, which again could be paid as a lump sum, an income or both. You can continue to live in your home and will keep full legal ownership. Usually, the loan does not need to be repaid until you pass away or move into alternative accommodation.
An Independent Financial Advisor can guide you through what sort of Equity Release mortgage is best for you, since there are a variety of schemes available.
Equity release might be right for you, but it’s important to carefully consider the advantages and disadvantages before committing. You should also consider the impact of any arrangement on your tax and benefit position.
Biscoes are members of the Equity Release Council, which is a dedicated trade association for the industry, ensuring high levels of conduct and service in the provision of Equity Release advice.
If you would like to speak to one of our Equity Release specialists today please contact us on 01983 533938.