Equity Release - A Guide to Equity Release in the UK

What is Equity Release?

If you are over 55 years of age and have no or little mortgage on your home, you maybe able to release some of your property's equity and receive either a cash lump sum or a regular income. Many people who reach retirement age find that there are countless things they want to achieve but just simply don't have the funds to action their plans. Whether it is a holiday of a lifetime, a new car or simply easing the day to day living costs, Equity release is just one of many options which could be considered.

Land Registry have released figures in February 2010, that show that the average UK house is now valued at over £160,000. With this in mind, Equity Release Plans could provide a real opportunity for many people who are retiring on a tight pension to take advantage of the money which is tied up in their property, allowing them to enjoy a financially comfortable retirement. Another advantage of equity release plans is the ability to release cash from your own home without having to sell it and move out.

It is advisable to seek independent advice before making any commitment to an equity release plan as there may be more suitable options.

One of the biggest downsides to Equity release plans is that they do impact on your "estate" which you may want to leave to your loved ones. This key fact should be discussed with family and considered seriously. There are other alternatives to consider such as:

The amount of funds you require and the cost implications of the method you choose to access those funds should be fully understood before proceeding with any plan.