When you take out equity release, if you have an existing mortgage or any other debt secured against your home, you must pay this off first, this can be done with the funds you release. Without monthly mortgage repayments, you could free up your retirement income, as well as have some peace of mind for the future.
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You could choose to spend the equity release funds to improve your home or garden. It could be for a personal want – creating more space with a new conservatory or loft conversion, or simply renovating it with a new bathroom or kitchen. Some also choose to renovate their home for a more practical reason – ‘future proofing’ it with walk in showers or stair lifts to ensure they can stay in their homes for longer.
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People could also retire whilst being in debt, and it can often disrupt what should be an enjoyable time in life. Using equity release funds to pay off any existing debt from credit cards to loans can help alleviate the cycle of paying minimum monthly payments and free up your income to spend on the things that matter to you. This is because unless you choose to make them, there are no repayments on a lifetime mortgage until the plan comes to an end.
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We’re all living longer and it’s becoming increasingly common to help your loved ones sooner rather than later, providing an inheritance while you are around to see them enjoy it. Equity release can provide a lump sum which can be used as a financial gift to help loved ones fund their education, get onto the property ladder or simply help to ensure their financial security.
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You’ve worked hard all your life and paid into your home, so when retirement approaches, it’s great to know your home could pay you back. Whether that’s paying for the trip you’ve always wanted to go on or simply travelling to see family more, it’s up to you.
Equity release isn’t a single-use financial product – many customers use the funds released for more than one reason.
At Mortgage Advice Bureau Later Life, we can help with advice, ensuring that you balance both your short-term and longer term financial needs. We’ll make sure you have all the facts and understand your options, so you can feel confident that any decision you make is the right one for you. Mortgage Advice Bureau Later Life offer one type of equity relase, lifetime mortgages, which is a loan secured against your home.
The first step to find out whether equity release could help you is finding out how much you could release from your home. Use our free equity release calculator for instant results.
Your equity release adviser will also outline the following important things to think about:
Before deciding on equity release, our advisers will make sure you're aware of some of your other later life finance options such as retirement interest-only or retirement payment mortgages.
Knowing the costs associated with equity release and how to help manage them is important.
Compound interest explained
How much does equity release cost?
