Equity Release Explained | Mortgage Advice Bureau Later Life

What is equity release?

An equity release plan allows homeowners aged 55 and over to access some of the tax-free cash locked in the value of their home.

How does equity release work?

The value of your home, minus any outstanding mortgage and any other loans secured against it, is the equity you have in your property. This equity is often passed on as an inheritance, however, an increasing number of people are tapping into some of this wealth to help boost their retirement finances.

Most people who take out equity release, choose a lifetime mortgage, which is a loan secured against your home. With the flexibility of these plans, you can choose between taking your tax-free cash in one lump sum or have it available to drawdown as and when you need it following an initial, smaller, lump sum release. With a drawdown plan, you only pay interest on the money released.

There are typically no monthly repayments for you to make with a lifetime mortgage, as the loan, plus roll-up interest (also known as compound interest), is repaid when the plan ends. That’s usually when the last remaining applicant either passes away or enters long term residential care.

To learn more, visit: https://www.mablaterlife.com/equity-r...