Equity Release – A Modern Solution?

Saturday April 21, 2018

The current unhealthy climate of low savings rates, poor pension payouts and inflation is seeing more and more older people taking out equity release mortgages. As we live longer and pensions return less income, the number of people borrowing money from the wealth locked up in their home is expected to soar.

Getting independent advice is vital and The Finance Roome can help you with this. Taking out an Equity Release plan involves both you and your beneficiaries so we can not only help you to find the best deal but also ensure you consider the effects on your benefits and any inheritance you would like to leave. If you would like to know more just drop Ellen a line and she will arrange a chat with you. Or call us on 01242 226353.

This week we look at the various ways equity release can benefit our clients, and the possible uses of released capital.

Clearing unsecured debt is common – and a growing area for many. Buying a house another – clients can take out an equity release plan in order to fund any shortfall on a property purchase, where age negates choice in the mainstream mortgage market. Many clients use the proceeds to purchase a second or holiday home abroad or in the UK.  Retiring in search of sunshine is once again becoming a popular choice; as long as you are a UK resident for six months of the year this could be an option for you.


The struggle for First Time Buyers these days is well documented hence it is becoming more commonplace for parents and/or grandparents to help first time buyers to get onto the property ladder by using an equity release plan to gift the deposit.

Less well known options include using equity release to pay off an outstanding interest only mortgage – again very topical at the moment as the number of older clients with interest only mortgages and no repayment vehicle is alarming. Retired renters who might have been renting property all their lives can become home owners on retirement by taking out an equity release plan on a house they are looking to purchase. They would be able to avoid Stamp Duty and could benefit from the increased mortgage age limits offered by some lenders.


Watch this space – next week we talk about the pitfalls and alternatives – any questions are very welcome.