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Equity Release - Your Top Ten Questions Answered

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Equity Release – Your Top 10 Questions Answered

In our Residential Conveyancing department we are often asked by our clients to give them advice when they are considering Equity Release Schemes.

In this Blog, Arlie Asbury, one of our Licensed Conveyancers and a specialist in Equity Release, answers the Top 10 questions that her clients ask.


1. What Is Equity Release?

Equity release is a way of releasing the money tied up in your property without having to sell it and move to another home. You can either borrow against the value of your home in exchange for a lump sum or a regular monthly income.

2. How Does Equity Release Work?

The amount you can borrow depends on your age and the value of your home. Unlike a standard residential mortgage, with equity release you don't have to make monthly payments, unless you choose to do so. The mortgage and all accrued interest is usually paid back from the proceeds of selling your home.

3. Do I Qualify for Equity Release?

To qualify for equity release you must be at least 55, own your home, with or without an existing mortgage, and the property is or will be your main residence.

4. What Can I Use The Funds For?

Anything!  Help with day-to-day living; to make improvements to your home; buy a new car or go travelling; help children or grandchildren with house deposits or student fees or to pay off debts.


5. Why Do I Need A Specialist Lawyer?

Equity release is a specialised area where it is important that you receive good quality legal advice from a qualified lawyer who has experience within this area. This is a life time commitment and you must receive the correct, specialist advice so that you may make an informed decision.


6. Will I Be Able To Live In My Home For The Rest Of My Life?

Yes. You are able to remain living in your home for as long as you want to or need to.

If you decide that you need to move in to long-term care or with your family, your home would need to be sold at that stage to allow the loan to be repaid. However, it may also be possible to arrange for care in your home, subject to the lender's criteria at that time.


7. What Happens If I Want To Move House In The Future?

You have the right to move your plan to another suitable property.

Please note that if you are moving into a less expensive home, you may have to pay back part of the outstanding mortgage.

If you want to move but not transfer the plan to that other property, for instance because you are moving in with family or into a residential home, then the mortgage will have to be paid off in full. Early repayment charges may apply in both these situations.

8. Is There A Chance That My Family Will Inherit Any Debt?

As a general rule, the debts of a deceased person are paid from any money or other assets they leave behind and family members would usually inherit the net amount after payment of all debts. However, with certain types of equity release products, for example, those that offer a ‘no negative equity’ guarantee - the equity release provider agrees not to claim against any asset other than the property from which the equity was released.

9. Will Equity Release Affect My Benefits Or Tax Position?

You should always discuss your particular circumstances with an Independent Financial Advisor, as everybody’s circumstances are slightly different and individual to them.

10. Should I Change My Will If I Enter Into An Equity Release?

An equity release plan will have a financial impact on the value of your estate following your death. You may therefore wish to get specialist advice on whether to re-write or redraft your will.


Do you have more questions or would you now like to speak to a solicitor who is an expert in Equity Release?

Call Arlie Asbury today on 01530 412167 or email her and she will be happy to advise and help you make the right decisions for your future.

Arlie is a Licensed Conveyancer in our Residential Property department.

She is able to assist with freehold and leasehold sales and purchases, new-build purchases, equity release, transfers of equity, re-mortgages, and unregistered land.