The word Equity Release might have negative connotations for you. It has certainly had its fair share of unfavourable press over the years. However, in recent times the industry has become more tightly regulated.
Your pension fund may not provide all the income you need to enjoy the retirement lifestyle that you want, so to avoid going without, you may wish to consider Equity Release. You may wish to release equity from your house now whilst leaving your pension pot to grow further. Equity Release may also provide the solution to those wishing to retire early but who have a shortfall in their projected pension income.
Additionally, mortgage rates are at a historic low which means that Equity Release rates will also be low. These changes mean that Equity Release could now be a realistic element of your Retirement Planning.
But…isn’t Equity Release a bad idea?
Equity Release is a financial commitment, which in many cases, is for the remainder of your life, so it is not always suitable for everyone.
Equity release could be a good idea for you if you’re looking to unlock tax-free cash that is currently tied up in your home.
What is Equity Release?
Equity release is the term used to describe the diﬀerent ways in which you, the homeowner, can benefit from the value of your house without having to move out of it. You can take out a loan secured on your home, or you can sell part, or all, of your home to give you a regular income or take a lump sum, or both.
Why is it so popular?
Post-retirement finances are becoming increasingly stretched, and it can be frustrating to many that your most significant financial asset is the funds tied up in your house. Equity release can provide a solution to this problem as it releases capital from the house while you continue to live in it.
Is Equity Release right for me?
If you are considering Equity Release as part of your Retirement Planning, then you must seek financial advice from a professional. It is important that you fully understand the facts before committing to Equity Release. Equity Release is not a one size fits all approach and it may be that there is a more appropriate financial solution for you.
**Your house may be at risk of repossession if you do not keep up with loan or mortgage repayments.