What is equity release? Equity release refers to the various ways in which you can use your home to generate income. This means that you can release cash from your home without the hassle of having to move.
There are usually certain conditions that you must meet before taking out equity release. These may include:
• A minimum age, usually 60, but some schemes may be open to people over 5.
• You must own your own home and have no dependents living with you.
• You have little or no mortgage left.
• Your property must be in a reasonable condition and over a certain value.
Things to consider
Raising income from your home is a big decision and might not be your best or only solution. Make sure you think about all of your options before making a decision.
• Do you have other investments or assets that could boost your income or give you the money that you need?
• You may be entitled to benefits such as Pension Credit, Council Tax Reduction, and Attendance allowance. Use our benefits calculator to find out what you’re entitled to.
• If you’re struggling to pay off debts, take a look at our debt advice.
• If you need help with repairs improvements or adaptations to your home, find out first if you can get help from your local council or other agency.
The costs and fees of setting up equity release plans will vary between different providers. Typically the costs will include:
• Completion, arrangement or application fees that cover administration cost.
• Valuation fees that will depend on how much your home is worth, with higher prices for more expensive properties.
• Solicitors’ fees that cover the legal work carried out on your property.
• Early repayment charge if you want to pay off your loan early.
• Make sure you get specialist independent financial and legal advice before signing up for equity release.