How to remortgage to release equity
Why remortgage to release equity?
Equity release remortgages can offer older mortgage holders a method for raising capital utilising the current value of their property, without needing to downsize.
At Fair Mortgages, we can offer you an in-depth evaluation of your financial circumstances and equity release needs to help you choose the equity release remortgage that is a good fit for you.
What type of equity release scheme to choose?
There are two key streams of equity release arrangement - lifetime mortgages and home reversion plans. Equity release is a major financial undertaking and before you decide what kind of remortgage to release equity that you want to choose, it can be a good idea to consult an independent, whole of market mortgage advisor. In basic terms, the contrasts between the two sorts of equity release arrangement are as follows:
Lifetime Mortgages – with a lifetime mortgage you take out a loan that is secured on your home, while you continue to own and occupy your property. You will pay back the loan when you die or move into residential care. With a lifetime mortgage, the total amount that you will be able to release from your home will depend on two factors – the age of the youngest applicant, and the current valuation of your property. You may be able, in some circumstances, to borrow more than half of the value of your home.
Home Reversion Schemes – with a home reversion plan you sell all or a proportion of your home’s value to a home reversion organisation. You will no longer own your home but you can continue to live there, and you may be required to pay a small amount of rent. The home reversion company will sell your house when you die or move into a care facility.
Things to bear in mind when considering a remortgage to release equity
How would you like to get your cash? - With equity release plans, you generally get the cash as a single lump sum which you can then use as you wish, although some schemes permit you to take the money in instalments as a salary.
Which kind of equity release arrangement is best for you will hinge on what you are intending to utilise the cash for – in the event that you are arranging a one-off expense like a holiday, then a larger single payment may be of more use to you than several smaller payments.
Have you looked at the equity release remortgage market? – Before you commit to a remortgage to release equity it is a good idea to do your own comparison of different equity release remortgage offers in order to figure out which ones offer the rates and benefits that are ideal for you, and additionally to find out any potential disadvantages.
The equity release market is a broad one and you may find that there are a lot of diverse options to look over, which can be time-consuming and can make it hard to know where to begin. Our specialists can help you to consolidate your choices and select the equity release remortgage that is right for you.
Have you understood the potential advantages of a remortgage to release equity? - If you are one of the numerous over 55s who hold significant money locked up in your property, yet don't have much disposable cash to hand, then a good equity release plan could permit you to get hold of some of this money to spend as you wish, giving you more choices for your retirement.
Have you understood the potential disadvantages of a remortgage to release equity? - Equity release remortgages are not a good option for everyone.
They can have an effect on your inheritance, and can also influence your benefit entitlements, especially for means-tested benefits and government grants.
Choosing to remortgage for equity release
Remortgaging for equity release is a major financial decision with various benefits and potential drawbacks attached, which means that getting the best equity release remortgage advice should be a key priority.
At Fair Mortgages our team of independent, whole of market mortgage experts can discuss your equity release remortgage requirements and help you to find the most suitable equity release remortgage deals for you – call us today or to speak to one of our mortgage advisers click here »