Equity Release Options for Older Adults
In the event that your equity is no longer enough to support you, there are a variety of options for release. Equity release products offer an alternative to selling your property or using up all of your savings. There are many different types of equity release product available and each has its own benefits and drawbacks.
There are two types of equity release options: lifetime mortgages and home reversion plans. A lifetime mortgage is a loan secured against your property, so you don’t need to sell it when the time comes for retirement. You can borrow up to 75% of the value on top of any other borrowing that’s already been taken out on your property over the years. With a Home Reversion Plan, there might be more restrictions as they cover only part of your house rather than all or most, but these schemes also offer an excellent way to get financial assistance with living costs in later life if needed without having to resort to selling your home. The downside could be that should something happen such as being unable to afford repayments then this option could result in you losing your home.
A variety of mortgage companies offer the lifetime mortgage, and it is worth investigating whether they have a scheme that will suit your needs. They might not be as flexible in their requirements for taking on equity release products and so advice should always be sought first before choosing this option. With regards to Home Reversion Plans, these are provided by around 30 providers across the UK; again there may well be one more suitable for you than others depending on what other financial arrangements you already have in place.
If none of these options work out then another way to free up some money would be to consider downsizing or even selling off part of the property if possible – however make sure any such sale does not jeopardise your care package or any other financial arrangements that you might have in place.