12 Practical Uses for Home Equity Release
Older homeowners live to see the value of their estates multiply, and they
earn thousands in tax-free money from each of their estates, making their
estate wealth soar to record highs. With this in mind, you can imagine
why equity release has risen to become the most popular retirement financial plan for
many.
Whilst some may still opt to downsize, it usually presents a challenge when it
requires you to move away from your family.
Equity release enables you, as a proprietor, if you are 55 and above, to
borrow funds against the value of your home and repay it when you die or move
into a care unit.
The most popular equity release examples include lifetime mortgages and home reversion plans. These schemes offer a lifeline too many with
debts or shortfalls in your pension income.
What Can Equity Release Be Used For?
This article will provide you with 12 of the most practical uses for equity
release you can use to improve your life:
#1. Home Improvement
Do you ever think of modernising your house design and adding
accessories? Well, an
equity release can help you work on your home renovation projects and still
leave you with some money to spare.
You can use the tax-free funds you get from equity release to make your home
feel more modern and boost your self-esteem.
#2. Cater for Your Care Home Expenses
There are current cases of negligence regarding the aged-care systems. You can
opt to get in-home care and use equity release fund to finance the service you
get.
Other than relying on the local government contributions, you can draw
an equity release, and get the funds needed to get yourself the best care.
Equity release can help you achieve more comfort and dignity later in
life.
#3. Mobility Equipment
As age catches up with you, your limbs may become weary, and sometimes you
might need to have mobility aid in place to help you manoeuvre around the
property.
Equity release plans can help you achieve a respectable level of comfort by adapting your
passages, installing high-quality stairlifts, adjustable beds, reclining
chairs, mobility scooters, and anything else that’ll help make life
easier.
#4. Pay Off the Mortgage
Perhaps you experience stress searching for ways to clear your mortgage
because you don’t know where to start. Consider how, according to the
Financial Conduct Authority, 28% of homeowners that got with equity release in
2019 used it to pay off their existing mortgages.
You can also take out the equity that’s tied up in your property and repay
your remaining mortgage.
#5. Clearing Debts
Some debts become very costly over the long-run but taking out an equity
release plan might be your best option. Releasing equity might seem tricky, but considering that you repay when you die or move
into permanent care, it emerges as the most suitable financial plan to help
you avoid breaking in debt.
You always need to make sure you consult an independent financial adviser to
ensure that you understand risks and cost covered.
#6. Making Investments
Many consumers of equity release use it to fund their business ideas. You too,
motivated by the sole purpose of multiplying your money, you can use the
equity tied up in your home to make the most of lucrative investment
opportunities.
Don’t forget to consult your professional financial adviser before you risk
your equity on investments.
#7. Helping Your Friends and Family
The financial crisis and other economic challenges have motivated the world to
change family lives for the better. An equity release plan like a home
reversion or lifetime mortgage can get you the funds needed to help your
children and grandkids to get on the first step of the housing ladder with the
capital for a deposit.
#8. Your Dream Ideal Holiday
Using an equity release to free up the money valued in your home, you can turn
your fantasies into reality and pursue your dream holiday.
#9. Boosting Income
Sometimes your pension can’t help you meet all your needs; an Equity release
can boost your pension funds and help make your life a little more
comfortable.
#10. Purchase Another Home
Most people just dream of having a second home. You can make that dream to
life by using your equity release schemes to purchase a second home.
One alternative is to get a buy-to-let property, then using the extra rental funds to
support your pension.
#11. Buying Your Partner Out
Recently, divorce rates have been spiking in the UK. There are now rates of
over 100,000 couples trying to beat hurdles on how to divide their assets and
savings.
Perhaps nobody can afford to buy the other out; most people opt to selling the
house and splitting the proceeds. However, if you want to avoid selling the
home, utilising out an equity release plan can be the perfect option to
choose.
It will not only enable you to secure some cash, but it will allow you to buy
out your partner, thus reducing the stress on the divorce process.
#12. Staying Up-to-Date
Perhaps you’ve been feeling like you’re lagging regarding technological
progress and the modern lifestyle, an equity release can help you gain more
modern devices and other belongings.
You could finally get rid of that old TV set, old furniture, old car, and
other useless gadgets.
Life expectancy is on the rise, and people are living longer than ever before.
You have more time to enjoy your earned retirement.
To Conclude
Unlocking some equity that has accumulated with the value of your home and
using it to fund your plans, which may include some stated examples of
uses, you can easily make
your retirement worth your while.
Therefore, consult your trusted financial adviser and make plans towards taking out your equity release plan and how best you can use it.
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