Many people who are planning their retirement or need extra cash during retirement are turning to equity release from Age Partnership; this has become a popular way to ensure you live comfortably during your retirement years in your own home.
There are people who are concerned about this type of scheme; they worry how it will affect them and their home, how their loved ones will be affected and how they will pay back a large loan. This is the great part about equity release from Age Partnership, you get to remain in your own home and repayment is taken after your death or when you choose to move into care.
How Does Equity Release Work
So how does it all work? Basically this form of equity release is when you get a tax free sum to the value of your home, there are a few types to choose from, but the main two are lifetime mortgages and home reversions, each of which comes with their own advantages and disadvantages, as everything does these days.
Equity release has become such an important part of retirement planning as it enables you to use the funds from the property while staying in the property. You can use the money for anything you want from buying that holiday home in warm Spain where you can spend the cold winter months or use it for urgent home improvements.
Lifetime Mortgages
The lifetime mortgage is when you take out a new loan on the property without the need to make any repayments. You can choose to receive a lump sum or payments over monthly instalments to help supplement your monthly retirement fund. After you pass away or move to care the house is sold repaying the borrowed amount, any amount left over will be passed on to your estate where it will be handed to your beneficiaries as per your request.
The advantages with a lifetime mortgage are that there is no interest payable while you live in the home and the interest rate is fixed. The disadvantages include the fact that your family may not benefit from any funds after you pass on as the interest can rise very quickly.
Home Reversions
Home reversion is the most popular choice when it comes to equity release from Age Partnership. This is where you can sell part or your whole property but continues to live there while you enjoy the benefits of an additional income. On your passing the house is sold to repay the amount and the balance is handed to your estate. The advantage is that you know exactly how much you have sold so you know how much your beneficiaries will receive the disadvantage is that the part you do sell is sold at a discounted price.
Equity release from Age Partnership can be the solution to monetary problems during your retirement, a time when you are meant to be relaxing and enjoying life to the fullest.