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Equity release is a way to release cash from your home without having to move. There are advantages and disadvantages to equity release products. You should consider all your options and get independent financial advice before deciding if it’s the right choice for you.
Housing equity is how much your home is worth if it was sold today (the market value), minus any mortgage or debt. Equity release allows you to use that money by turning it into cash.
There are two types of equity release.
For both types, you can protect some of the value of your home as inheritance for your family if you want to. This is known as ring-fencing.
There are usually eligibility criteria and conditions to meet before you can take out an equity release product.
Equity release products are regulated by the Financial Conduct Authority and there are rules about what providers must tell you about equity release.
You should make sure you take out an equity release product with an authorised provider. Contact the Equity Release Council for details of member organisations. They have stricter rules than the basic regulation requirements.
When choosing a provider, remember to ask:
Before releasing equity from your home, it’s important consider all the implications - not just now but in the future too.
Equity release puts money in your hand. You could use the money to:
You can receive the money as a lump sum, as a regular payment or as a combination of both.
Equity release options aren’t suitable for everyone. Disadvantages to consider include:
Before deciding, it’s best to get advice from an Independent Financial Adviser (IFA) who specialises in equity release. You can search for an IFA through the Society of Later Life Advisers or Unbiased.
Equity release is one option. However, there may be other ways to raise money that might work better for you. You could try:
If you’re struggling with debt, there may be other solutions. Visit our page Help if you're in debt for more information.
Find more information about equity release on the Money Advice Service website.
Search for an Independent Financial Adviser at the Society of Later Life Advisers or Unbiased.