The Six Optional Equity Release Uses
Equity Release Uses are an important part of the Equity Release process. An equity release is a financial product that enables you to borrow against your house’s value so you can receive some money now, while still owning your home. It has many names depending on where in the world you live; it may be called “equity withdrawal” or “equity drawdown” in different parts of the world. Equity releases may also be known as “reverse mortgages” or “home reversion plans”.
Some examples of equity release uses are:
To provide funds for a major purchase such as home renovations or to pay for an education. This is a very common use of equity release.
To provide funds for an emergency such as a sudden medical expense or to help with funeral expenses.
If you’re looking to consolidate debts and have found that your mortgage is costing more than you can afford, equity release may help by borrowing against the value of your property without having to give up ownership.
Some people use it when their loved ones are no longer able to live independently because they need care in order not to go into a nursing home. Equity releases may also be used if someone has been diagnosed with Alzheimer’s disease and needs extra support at home but doesn’t want to move into residential care.
Other equity release also include: buying new but smaller home.
Of course, equity release uses depend on your needs and circumstances. You need to keep in mind that equity release is a loan, and so you need to make sure that the repayments are affordable. What type of equity release you will choose depends on your particular circumstance.
The payment might be in a lump-sum or it may be spread over time through monthly payments that you can afford and manage. Some plans also allow you to receive the money upfront, but this would have significant tax implications so should only be considered if there are no other alternatives available to you.