Why Do People Choose to Release Equity?
Choosing to release equity from a property isn’t a new concept. In fact, its very common and still increasing in popularity, with nearly 97% more people opting to release funds against their home in the past two years.
But what are these people using the funds for? How much difference is it making to people’s lives?
As a homeowner, we’ll bet that one of your long-term goals for your home has been to improve it in some way. Whether it’s one room that has been bugging you for years, or an entire makeover, having the funds to create the home of your dreams might have always seemed a little too much out of reach.
With equity release, this dream is more likely to become a reality. According to a report by the Telegraph on equity release in 2017, around 22% of respondents stated that they chose to release equity from their property to improve their home or garden.
The safest option in this instance would be to opt for a lifetime mortgage as this allows you to stay in your home for as long as you want and benefit from any value increases your property experiences.
Do you really need a reason to want a little more money in your bank account for a rainy day? You never know when you may need to dip into your savings if something urgent arises.
The same report mentioned above also recorded 22% of homeowners questioned used their unlocked property wealth to boost their disposable income. One of the main reasons for this is the lump sum is tax-free, and if regular payments are preferred, this can top up pension payments for those who have retired and give them a little more money to work with.
Many pensioners take advantage of this benefit as their state pensions are often only just enough to live off, especially if they haven’t invested in a private pension pot.
Pay Off Mortgage
Enjoying the start of your retirement but worrying about paying off your existing mortgage? Don’t worry – equity release can help you with that, too.
In fact, 25% of the Telegraph Equity Release in 2017 report respondents said that existing mortgage payments were the main reason that they chose equity release. By releasing funds from your home with a lifetime mortgage, you’re guaranteed to retain ownership of your property. You’ll be able to release cash to pay off your mortgage and potentially enjoy a boosted income at the same time.
Understanding what equity release can do for you can help ease your mind if you are starting to worry about your income or retirement. Using our comparison tool, you can find the best deals for your individual circumstances – how will you use your released property wealth?