Prime Time Financial

If you have been considering the basics of Equity Release plans you soon come to the question "Is it suitable for me?". (If you want to know the basics, see our article Introducing Equity Release).

So first of all, here are some requirements which need to be met before you can consider going ahead:

• You should be aged 55 – 95
• You should own your own home
• Your home should be worth a minimum of £75,000
• You should not have a current mortgage - or only a small one which would be repaid at the start of the Equity Release plan
• The property should either be freehold or, if leasehold, it should have a lease of at least 75 years left
• The property must be of standard construction

After that, you need to be clear in your own mind why you want such a plan. You may be looking for a lump sum to make some home improvements, for a big holiday, to treat the family, or to pay off debts. Alternatively, you may be looking to supplement your general income in retirement, in which case the ability to take a smaller lump sum each year, or more frequently, is what you need.

If you are clear on your reasons, then now would be a good time to consider the alternatives as well. Equity Release plans are the right solution for many people, but there can be disadvantages. One of these is that the value you can pass on to your family on your death could be significantly reduced. As a result it is a good thing to fully involve the family where appropriate.

If you are receiving any state benefits, then these may be affected by taking out an Equity Release plan.

So what are the alternatives? They will depend on your circumstances, but releasing capital by moving to a smaller property is one option, while taking more income from savings or investments might be another. And it's always a good thing, too, to make sure that you are receiving all the benefits you are entitled to.

Having said all that, the best option for you may well an Equity Release plan. We would be happy to help you - Contact us.

Last reviewed 25th May 2011