If you are looking to raise money then equity release is something can be considered. If you are over the age of 55, you can use the value of your home to attain funds.
We always recommend that you consult with independent legal advice before you consider entering into a legally binding equity release contract.
EQUITY RELEASE ADVICE BY REFERRAL ONLY
Why should you consider Equity Release?
- To provide an additional income
- To provide lifetime gifts to relatives
- For home improvements
- For holiday home purchase
- To fund long term care
The options to use the money isn’t restricted therefore you may have other ideas in mind in which you need the funds for.
It is worth noting however that equity release can be an expensive way to raise money when taking into consideration payment of arrangement fees or interest. So, with this in mind, you should also consider the following:
- Sell your home and live-in rented accommodation
This option involves selling your house and investing the proceeds in income producing investments. The income from these investments is then used to rent a property and for your living expenses. You would only really be able to generate sufficient income to live on if your property was sold for a large sum of money, so this option should only really be considered if your house is worth in excess of £400,000.
- Benefits entitlement
There are a number of benefits you might be entitled to so we always recommend you carry out research here. It may be that you are entitled to benefits and therefore equity release may actually be unnecessary. Also, equity release could affect your entitlement to means-tested benefits so it’s worth speaking to your local authorities to consider these areas first. There could be help for grants or assistance with essential home improvements and alterations that you would otherwise pay for yourself.
- Your Savings & Investments
An alternative option might be to look at what savings and investments you have available to you.
- Rent out a room
If space allows, you may with to consider renting out a room to bring in regular extra income. Remember, if you are receiving benefits, you have to declare all income you earn.
- A smaller home
When raising a family, there comes a time when dependents become financially responsible themselves and therefore the need for a larger home might not be required. In this case, you could consider purchasing a smaller property that is more economical to run, leaving you with a lump sum on completion of your property sale.
It is important to recognise that equity release has to fit with your needs, circumstances and preferences. That is where the benefits can evidently outweigh the risks or be considered a more suitable solution than alternative methods of raising funds.