Equity release (also called Lifetime mortgages) could be available to people aged 55 and over that own a property or looking to buy a property. It allows the property owner to get a mortgage regardless of income. It could be used to release equity tied up in property or buy a more expensive property. The Lifetime mortgage is secured against the security property like a standard mortgage but does not have an end date and instead is repaid on the event of death or entering into long term care.

Advantages of Equity Release (Lifetime Mortgages):

• Provides a tax free lump sum for you to use how you wish.
• You remain the owner of the property.
• Flexibility of paying the monthly interest or making no monthly payments.
• Most lenders offer a no negative equity guarantee so you will never owe more than the value of the property (all lenders have no negative equity guarantee when they are part of the Equity Release council)
• Inheritance tax planning

Disadvantages of Equity Release (Lifetime Mortgages)

• Reduces the equity in your home so less is left for your beneficiaries
• Eroding equity in the property if adding the interest to the lifetime mortgage.