‘My property is my pension’ – homeowners raise £70,000 each to boost retirement income
How much homeowners can release will depend on the value of their home. They have the right to remain living in their property for life, and do not have to repay a penny of debt in their lifetime (but can if they choose).
The interest rolls up, year after year, with the debt ultimately repaid from the proceeds of the house sale after the customer and any spouse or partner either die or go into long-term care.
Any money left after costs falls back into the estate and can be passed on to loved ones as an inheritance in the usual way.
Andrew Morris, senior equity release adviser at Age Partnership, said discuss your decision with loved ones as equity release will reduce the amount of money you leave behind when you die.
He said the best plans offer an invaluable piece of protection called the no-negative equity guarantee. “This pledges that you and your family will never have to repay more than your property is worth, even if house prices crash before you die.”
It means your loved ones will never inherit any debt, Morris said. “Equity release is not right for everybody so take professional advice to consider all of the alternatives, and talk to a solicitor before signing up.”
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