Working hard to buy your home is a very British thing to do, and for many people paying the mortgage is a higher priority than saving for retirement.
So for many, equity release is a good way to use their home to help them live a more comfortable life in retirement.
However, if you took out an equity release loan some time ago, it may be worth looking at whether it might be possible to get a better deal now.
Rate cuts in the equity release marketplace mean that interest rates on these loans are at all-time lows, with some lenders charging as little as 4.3% according to specialist adviser Bower Retirement. The average rate now stands at 5.66% it said, around one percentage point lower than three years ago, while the number of plans available has trebled.
Equity release can be undertaken after you reach 55, and since there is no monthly payment being made to the lender – the interest rolls up and the lender is paid when your home is sold on your death or the death of a dependent – it is easy to ignore the benefits of getting a better deal. But that does not mean you should.
Equity release may include a lifetime mortgage, to understand the features and risks, ask for a personalised illustration.’ where the promotion also relates to a home reversion plan the statement may be adapted to the extent necessary to comply with the equivalent requirement for home reversion plans.