Here's What You Need to Know
Thinking about using your home's value to access cash? Equity release can be an option, but it's a big decision. Let's explore the pros and cons to help you decide if it's right for you.
Benefits and Safeguards
- Access Cash: Equity release unlocks money tied up in your home, potentially improving your lifestyle or helping loved ones.
- Safeguards in Place: Strict regulations and a "no negative equity guarantee" protect you and your heirs. You'll never owe more than your house is worth, and you get to stay in your home for life.
- Flexible Options: Choose plans with fixed interest rates and the ability to make voluntary repayments to manage the future balance. Some plans even allow penalty-free early repayment under certain circumstances.
- Professional Guidance: Equity release requires financial and legal advice. CompareRelease.com's qualified advisors can explain all the details and ensure the plan fits your needs.
Things to Consider
- Reduced Inheritance: The amount you borrow reduces what you leave to heirs.
- Potential Impact on Benefits: Equity release may affect your eligibility for means-tested benefits. Discuss this with your advisor.
- Long-Term Costs: Interest accrues over time (unless you fully meet the monthly interest), increasing the total amount owed. However, potential house price appreciation can offset this.
- Early Repayment Charges: Some All plans have potential charges for early repayment. Discuss this with your advisor if you think you might need to repay early.
Equity Release vs. Traditional Mortgages:
Equity release differs from mortgages in a few ways. There are typically no required monthly repayments, and you can't be repossessed for non-payment. However, the interest accrues and is added to the loan, potentially increasing the total amount owed significantly over time.
Peace of Mind
Equity release is a regulated industry with strong consumer protections. CompareRelease.com's advisors are all qualified ERC members, ensuring you receive the best guidance.
Considering Other Options?
We recommend exploring all possibilities, including downsizing, before deciding on equity release.