Why take out an Equity Release plan?
There are many reasons for someone taking out Equity Release, with a variety of options tailored to your circumstances.
Some choose it for aspirational reasons - a one-off around the world cruise, new car, property maintenance, gift for a grandchild to get on the property ladder etc. Whilst others are for more essential reasons such as paying for private medical expenses, savings have depleted or an interest-only mortgage has come to the end of its term and cant be renewed due to income levels. Its actually for any reason you choose - there is no stipulation by the lenders.
There are 3 main options for a Lifetime mortgage Equity release plan:
Maximum sum upfront, this is the full amount you can withdraw from your property and transferred across to you in one payment;
Initial sum with further Drawdown, a lender will approve you up to a certain amount. However you may only want a smaller amount - this just means the remainder is there as a drawdown option for you in the future should you need it. This way, you only pay interest on the amount you have actually borrowed - the rest is pre-approved and just there as an option;
Consistent monthly instalments, an agreed amount paid to you monthly for an agreed amount of years as a top up to your pension. You can cancel future instalments at any time and just pay interest on the money you have borrowed.
Equity Release can be taken on a residential or buy-to-let property, as single or joint plan, with the option of guaranteed inheritance to leave for loved ones.
As you can see there is a host of different options with the amount being raised based upon your property value, age and health. With so many variables, this is why the government decided you have to take advice on Equity Release and cant choose the plan directly yourself, in order to ensure all of the options are fully explained.
To discuss your circumstances further, in your own home at a time which suits - call to book your free appointment.