Apply for an Equitable Release
It’s not uncommon for people to want to release some of the equity in their home. Whether they’re looking at retirement, a new business venture, or even just a change of lifestyle – there are many reasons why someone would like to unlock the equity that they currently have tied up in their property. If you’re considering releasing equity from your property through an equity release scheme you need to know enough information.
It’s a way of releasing some of the equity in your property to either invest or spend, and it can be done without having to pay any upfront fees. In other words, you don’t need to borrow money from someone else or sell your home – everything happens through one transaction with an equity release provider.
The types of schemes vary depending on what you want to do with the cash that is released: if you want to use it for retirement then there are different providers than those who offer ‘interest-only’ loans where all you’re doing is paying back interest over time. If this sounds like something which might meet your needs, read on…
How does Equity Release Work? There are few ways for equity release to work: first is to release the equity you have built up in your property and use it as the collateral for a loan, or secondly to get what are best described as an ‘interest-only’ loan.
The first one is fairly straightforward: Equity Release providers offer their clients interest rates which can be lower than those on mortgages – meaning that they are cheaper to borrow from. And because all of the repayments happen through just one transaction with an equity release provider, there’s no need to borrow money or sell your home upfront. The downside is that if you want to pay off more debt then this may not be so useful; however, given how low these interest rates currently are, paying back any amount of capital should still make sense…
The second tyoe of equity release is often referred to as ‘lifetime mortgages’. They come in many different forms, but the main benefit is that they allow you to release equity from your property at a future date without having to pay back any capital upfront.