The following is a guest post
f you are retired, or close to retiring deciding whether or not you want to release the equity in your home is a big decision that requires a lot of thinking about. There are many things that you should consider before you make a choice. Equity release is a way of making money against the value of your house, but you can still live there, and you do not have to move out. You don’t start paying back the cash until your house is sold or until you go into long term care.
If you’re still having trouble deciding if you think releasing the equity in your home is the best option for you, then here is a short list of things you may want to consider:
What Kind of Policy Do You Want?
There are different types of equity release schemes that are available out there to you. There is a lifetime loan scheme where you still own your home, and receive a lump sum of money, or with some schemes, in smaller amounts as you need it, that acclimates interest. You must pay this back when your home is sold.
There are also home reversion schemes. On these schemes you sell your home, wholly or in part, to a home reversion company who own your home, or you still own a small part of it, who will then give you a contract that says you are allowed to live there rent free (or paying little rent) until you go into long term care or pass away.
What Are My Alternatives?
There are also other things that you could consider instead of releasing equity in your home such as downsizing to a smaller property, looking to see if you are eligible for benefits, or taking out a secured loan. You should probably take some time to ensure that you have considered all your options.
If it is something that you feel you want or need to opt for equity release, you then have the challenge of trying to find right equity release scheme for you. If this is something that you are finding a struggle, then there are lots of companies out there, like Bower Retirement Services, who can offer you advice that might help you to make up your mind.