First, ensure to understand how equity release works to use it to your advantage.
Equity is the total market value held in your home, less all outstanding mortgages or debts that you have secured using it.
Think about it...
The equity held in your home experiences increments as time passes, even as you make regular repayments and the value of your property increases. The total amount that you can release as equity differs regarding your age and some particular considerations, like health.
For you to get any consideration when applying for an equity release plan, be at least 55 years and above, and you must be the sole owner of a property with a value that can be proportionate to the equity loan you desire.
You can receive the equity release as one cash lump sum or in sizeable payments. You can spend the funds on how your needs. Although, you must first consider clearing any outstanding debts, using the equity release funds to clear these off. Then you can utilise the rest to get anything you need, for instance, to go on your dream holiday or merely to fund your home renovation projects.
And as if that’s not enough:
Remember, the equity you release is tax-free and yours to spend as you please. Some equity release plans provide you with the option to pay off the interest as monthly instalments; although there are still many options when that’s unnecessary.
In case you've been wondering...
A lifetime mortgage has emerged strongly as the most popular mode of equity release. It enables you the privilege of repaying your loan, along with interest, after the brokers sell your house. An action that usually takes place after you move into permanent residential care or are deceased.
How Long Does Getting
an Equity Release Take?
It takes an average of 8-12 weeks from the time you apply until your equity release gets processed and completed for payment.
Keep track of the timeframe...
Getting yourself in the hands of a reputable equity broker to help manage your equity release. The broker will ensure that the process runs smoothly and you get your money released with little stress; in the quickest way possible.
The Process of Equity Release
The specific process that you’ll experience as you engage in equity release will vary depending on you as a client and the different brokers that you may choose.
Wonder how does the equity release process start?
Initially, you’ll meet with a professional equity release adviser or broker to discuss your eligibility.
Then, you’ll set an appointment for a follow-up meeting in which you will now debate on your ideas and thoughts regarding the advice you initially got. Afterwards, you can apply, your adviser will oversee that, and when everything gets approved, you will receive your finds.
Important Equity Release
There are two significant categories of equity release plans which you have to pick from when you want to access the equity valued in your home but not sell it.
A lifetime mortgage is a tax-free loan received as a predetermined amount that’s secured using your property as leverage. Most homeowners in the UK that are 55 and beyond are eligible to apply, and they have this as an available option.
Now, what does it mean for you?
You can keep complete ownership of your property minus them requiring you to make any monthly repayments when you release equity as a lifetime mortgage. The total amount of money together with interest accumulated is due for repayment after you you shift into permanent residential care, or you die. And your property gets sold, then the debt gets repaid, and any surplus money goes to your estate.
When you release equity using a home reversion plan, they give you access to a tax-free lump sum or as continuous income flowing form you selling a portion of your home, if not all of it. A home reversion equity release is a service commonly available for property owners that are 65 and above.
Give it a thought...
Although, you consider that the amount you’ll receive as a payment from your broker will be below the market value of your home because you keep the right to continue occupying your home. You can remain accommodated in your house minus without paying rent until you move into permanent care or are deceased.