Equity release allows homeowners aged 55 or over to access some of the value (equity) tied up in their property without having to sell or move.
Types of equity release
- Lifetime mortgage: you borrow against your home. Interest rolls up unless you choose to make repayments. The loan is repaid when you die or move into long-term care.
- Home reversion: you sell part or all of your home to a provider in exchange for a lump sum or regular payments, while retaining the right to live there.
Key risks
- Compound interest can significantly reduce the inheritance you leave
- It may affect eligibility for means-tested benefits
- It reduces the value of your estate
Equity release is a complex, long-term financial decision. Always take advice from a qualified, regulated financial adviser before proceeding. Look for advisers registered with the Equity Release Council.