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Equity launch is a way to assist enhance your funds in later life by unlocking some of your own home’s value.   
  
Your property’s value, minus any outstanding mortgage or loans secured towards it, is its equity. This equity is commonly passed on as an inheritance; however, by way of equity release, you possibly can access a few of your property’s value tax free.   
  
Our equity launch products are available for dwellingowners aged fifty five-84 whose property is price no less than £ninety nine,000. Nevertheless, not all equity release plans work the same. This page is here to assist make the variations clear so you possibly can make the best resolution on your circumstances.  
  
How does equity release work?  
The type of equity launch you select will decide how it works. The most typical form is a lifetime mortgage; of which there are two types – lump sum and drawdown. We’ll go into a bit more detail on these below.   
  
The other form of equity launch is a home reversion plan. Home reversion plans are different to a lifetime mortgage. With a house reversion plan you will sell part or your whole residence to the home reversion firm at less than its market value. In trade you will receive a tax-free lump sum. You will no longer own your own home, though you've got the right to live there lease free.  
  
However the primary premise of a lifetime mortgage is that it could allow you access to at the least £10,000 in tax-free cash by securing a loan towards your property. However, unlike most other secured loans, there are typically no monthly repayments so that you can make – unless you choose to.   
  
That’s because the loan, plus compound interest, is repaid when your plan ends, which is normally when the final remaining applicant either enters long-time period care or passes away. Meaning you would access thousands of kilos in tax-free cash to help increase your later life funds without the worry of budgeting for repayments.   
  
How much you can release will rely upon just a few different things, together with the value of your property, any excellent loans or mortgage secured towards it, and your age.   
  
Usually, the older you're, the more you’re able to release. But bear in mind, if it’s a joint application, the age is predicated on the youngest applicant, rather than the oldest.   
  
It’s also essential to note that in case you have an existing mortgage or another secured loans against your property, they’ll have to be paid off first. You should use the money you launch to do that – but doing so will reduce the amount you must spend on different things.