Equity Release Uk Plans Can Reduce Your Liability

By Author: Hans Cruze
Total Articles: 47
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Equity release is a process in which a retiree increases money against the property value of their house and the lender is paid back once the property gets sold. Mainly there are three release equity plans on the UK market. They are lifetime mortgage, withdrawing lifetime mortgage and home reversion plans.

The money released from equity is used for many purposes. You need not worry for the rest of your life and can enjoy peacefully. Thus you can improve your lifestyle after retirement, help your children or grand children by mortgage deposit or contribute a larger share to the family expenses to avoid being a burden.

Previously release equity schemes possessed a very bad name due to increased rates of interest and low value of assets. However, today’s schemes are very advanced and popular. You can benefit a lot from these equity release UK schemes.

Types of release equity plans

Lifetime mortgages- this type of mortgage gives you a lump sum amount of cash, which does not levy any tax ...
... on your residential assets. Moreover you need not repay it as these are deferred till your property gets sold or when you expire. Generally the interest that is outstanding is repaid. A famous version of equity release UK scheme i.e. lifetime mortgage is withdrawing lifetime mortgage, where the retiree can take money in small amount when he needs. Using this type of plan, you can avoid accrued interest on loan that is accumulating for a long time. People, who make use of this type of loan, select an interest rate that is fixed throughout his life so as to know the outstanding amount at every point of time in the near future.

Home reversion plans- with the help of this release equity plan you can sell off your house in substitute for a lump sum amount of cash that you can spend whenever you want. In this case, there is no need for you to make any monthly repayments with the loan and the outstanding interest is paid fully when you die. They can release more money with no involvement of any loan. Old people find home reversions plans or this release equity to be attractive since they are not concerned with leaving behind any inheritance. Some people also use this plan since they believe that their property value won’t increase much in near future or neither will it fall down.

These equity release UK schemes are very helpful especially for a retired person, who wants to lead a good lifestyle for the rest of his life without any tension.