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Is now the right time to release equity in your home?

Equity is the difference between the current market value of your home and what you owe on it. By releasing equity, you can obtain a lump sum of cash that can be used for renovations, or other important purchases.

So, is now the right time to do it? In this current market, there are several considerations that should be taken into account before making this decision.

Can I get Equity Release at 50?

No, 50 is below the age threshold for Equity Release. You need to be at least 55 years old and have a certain amount of equity in your home in order to qualify for Equity Release. 

Do both homeowners have to be over 55 for Equity Release?

Yes, both must be over 55 to qualify for Equity Release. 

Can I release equity if I have bad credit?

Yes, affordability isn’t assessed when you take out an Equity Release plan, however you will be impacted if you go bankrupt or have an IVA.

What about repayment?

You can either let the interest roll-up until death or the need to move into care, pay some or all of the interest monthly or make voluntary lump-sum repayments.  This will all depend on your particular situation so you are advised to seek out a qualified Financial Adviser for advice. 

Can you be too old for Equity Release?

Some providers have an upper age limit, but there have been people well into their nineties that have released equity in their home. The common reason for someone to need Equity Release in their nineties is to pay for live-in care.

How does Equity Release work if you go into care?

If you are the sole occupant in the property then the ER would need to be repaid. This can be by sale of the property or family repaying the loan. Providers are generally happy for the loan to continue while matters are sorted out so long as they are kept fully informed.

If it is a couple in the property and one needs to go into care the ER loan continues as normal, provided both parties are mentioned on the loan.

What happens if you inherit a house with Equity Release?

If you inherit a house that has an Equity Release plan attached, it will need to be repaid either from the sale of the property or the estate beneficiaries taking out a standard mortgage or buy-to-let mortgage to achieve the same ends.

Considering the current market and your own personal situation, now may be the right time to release equity in your home. Being informed of the rules and regulations is key in making this decision.  It is always wise to seek professional advice and do your homework before taking out this type of loan. By doing so, you can ensure that releasing equity from your home is the right choice for you and your family.  ​