Tips to make equity release go as smoothly as possible
More and more people are turning to equity release to give them extra cash to spend in their retirement.
It allows people who don’t have a lot of cash but own a valuable home to have an easier retirement, with any money received through equity release paid back with interest after death.
However, there are still some downsides to consider. Here are tips from Oracle Consultants about what you need to think about before you choose equity release.
Would you be better off moving to a smaller house?
If you don’t have a problem with moving house, downsizing could be a good way for you to get some spending money without getting into debt.
Inform your family
If you decide to go the equity release route so you don’t have to move home you should inform your family of your plans as it will affect their inheritance because the equity release needs to be paid back after you die.
Think about how much money you actually need
If you borrow more money than you actually need to spend you will be increasing the amount of money that will need to be paid back after you die, which will affect your family’s inheritance.
The money you receive from equity release could also affect your entitlement to any means-tested benefits.
Get an advisor to find you the best deal
This is one of the most important steps to choosing an equity release policy. Equity release can be incredibly confusing and complex, so finding a specialist advisor to find you the best deal is a must.
Make sure you actually understand your equity release policy
There are lots of different equity release policies available, all with different features which could be either good or bad for you depending on what you are looking for.
Get your advisor to guide you through your chosen policy to make sure you really understand it properly.
Think carefully about your goals
Since there are so many different equity release policies to choose from, you should seriously consider what your goals are. For example, what do you actually need equity release for? This will affect how much money you need to take out.
You might also be following trends in housing prices and decide that your house will be more valuable in a few years’ time and so wait a while to release equity on it.