What is equity release and how does it work?

The equity release mortgage market has changed so much in recent years. A wide range of trade body governed, and regulated products tailored to older borrower’s needs and circumstances have replaced products that seemed, in the past, to result in insecure returns.

You might be surprised to find out how many options are available now that allow you to release cash from the equity built up in your home safely and securely.


What is equity release and how does it work?

Equity Release allows you to convert some of the equity you have built up in your home into a regular retirement income or into a lump sum of cash. The equity you have is how much you could sell your home for in the current market less any mortgage or other debt held against it.

Equity Release plans, based on your personal circumstances, can allow you to:

  • Convert some of your home’s value into a lump sum of cash or regular retirement income without having to sell and move home
  • Release some tax-free cash to spend on home improvements, holidays or outstanding debts, allowing you to enjoy your retirement
  • Release an initial large amount of cash, followed by small amounts as and when needed
  • Help a family member out financially
  • Have peace of mind as each plan comes with a ‘no negative equity’ guarantee
  • Decide how much of your property you want guaranteed to be left to your beneficiaries
  • Choose whether or not to make monthly interest payments

What is the difference between equity release and a lifetime mortgage?

To qualify for equity release you need to be over 55 and products are based on your unique circumstances. A lifetime mortgage is a form of equity release. The interest is charged on what you have borrowed, which can be paid monthly or added onto the total loan amount (no interest payments monthly). When the home is sold – the money from the sale is used to pay off the loan.

FAQs on Equity Release and Lifetime Mortgages >

At Private Wealth Mortgages we are authorised and regulated by the Financial Conduct Authority (FCA). We are also members of the Equity Release Council (ERC), the industry body for equity release mortgages. Our advisers hold equity release qualifications, so you are in safe hands. We will guide you through what is available to you, will consider your situation with care and compassion and find the best solution for your circumstances.

Call our expert mortgage advisers today

01403 270006
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