If you’ve worked hard all your life and you really want to turn your retirement years into really good ones, you have to check out the lifetime mortgage scheme. It’s a way to release the equity in your home, which isn’t a bad thing at all. When you think about it — why wouldn’t you want to release the equity that’s trapped in your home? If you aren’t planning on moving and you love your home, it gives you the best of both worlds.
Keep in mind that there are a lot of details that you’re going to have to iron out before you really get in too deep. Indeed, you need to make sure that you’re always thinking about how much equity this will actually pull out of your home.
The important thing to also note is that you will not get 100% of the equity. The lifetime mortgage company you choose will reserve a portion of the equity for other purposes, because your equity could change over time. What they’re actually doing is giving you a big loan, to be repaid with the sale of your home. If you have already notified your heirs of what you’re doing, then this isn’t a problem. The money that you receive from the lifetime mortgage scheme is going to be tax free, which is another good benefit.
If you’re going to get into lifetime mortgage / equity release schemes, you will definitely want to make sure that you are shopping around for the right company. They should be giving you a fee schedule as well, so you know what fees are involved. A qualified advisor will be on hand to answer any questions that you might have.
Can this really give you the extra money that you’re looking for? Absolutely! You can get it in a lump sum, or monthly payments over time. It’s completely up to you.
Again, this is something that you will want to talk about with your family. Not only will you have to talk about it when your spouse in order to get the equity release scheme underway, it also makes sense to discuss it with your children. It dramatically changes the value of the estate, since your home will not be on the table.
The most common question that we get in connection to equity release schemes is straightforward — will it actually affect where I live? Not at all. That’s the real power of these schemes — you get to keep your home and live there without having to make anymore payments. After all, this program appeals to people that have already paid off their homes — why would they want to pay rent all over again? Those days are definitely behind you at this point.
Again, be sure that you’re reading the fine print of any offer that you accept. That’s going to be the best way to make sure that you are doing the right thing for your own needs. Good luck!