Nine things to do with your equity release

If you are wondering what your equity release is for, here are some common uses for your property investment.

Your money is yours, so why not use it? A lifetime mortgage or home reversion will provide you with a lump sum, but what can you do with it? Legally, it’s 100% yours to spend.

If you’ve always wanted a thousand pairs of designer shoes, then that’s completely up to you – the mortgage lender isn’t going to bat an eyelid! I don’t recommend that particular course of action though! Here’s a more realistic list of things to that people actually do!

#1 – Improving your retirement

Simply putting your money in a bank account and having it there to pay bills and give you the financial backing for a coffee when you feel like it is no bad thing. Adding to your pension income, the money from your equity release will provide a cushion that you know is going to last you well into old age. If this is your plan though, you may want to stage your lifetime mortgage to minimise the interest your estate will pay.

#2 – Clearing debts

If you’ve already wracked up a little too much in credit card debt, overdrafts and personal loans, a lifetime mortgage will give you the funds you need to clear the lot! You’ll save in interest and get more from your monthly pension without having to assign any of it to lenders, but more than that you’ll enjoy an immediate boost in emotional and mental health.

Debts suck on us and are a major cause for depression across the UK. Wiping them out with this simple stroke is often worth the paperwork alone!

#3 – Home improvements

If your house was suffering from a few years where you haven’t been able to afford everything you might have liked, equity release provides a pot which can make you more comfortable for the long term. Plus, it has the added bonus of increasing your home’s final value and effectively lowering the impact of the lifetime mortgage on your estate.

#4 – A holiday (or two)

Life is to be lived and there’s a lot of wonderful world to see. Using your equity release to visit those places you have always dreamed of is high on many lists. You can go alone or reach out to your family and have a wonderful time with grandchildren – they’ll love you for it!

#5 – Helping your children

You remember what it was like starting a family, trying to find a deposit on a mortgage or just needing a boost to do that thing you always dreamed of. Ease the strain on your children’s lives by helping them out with the finances they are struggling with. It’s like an advance on their inheritance and is one that will be welcomed with open arms.

#6 – Taking care of yourself

Sadly, older age often comes with some health problems. If you need changes made to your home, some extended care, or more specialist medical treatment, then your home equity can be the security that enables you those very things. Make your life more vibrant with the help of your years of investment.

#7 – That thing you’ve always wanted

Shiny red sports car, collection of world whiskeys or just a luxurious bed, there are a lot of things worth splurging on to make your life that little bit better – and remember, it was your money saved up and paid in over decades of mortgage payments; you’re entitled to do whatever you want with it!

#8 – 1,000 pair of shoes

No? Just me then. OK!

#9 – Simply not being worried

People worry, it’s normal, and as you approach retirement and consider your financial options, worry can increase. The following are some of the UK’s most mentioned concerns leading to retirement:

– Frailty (both physically and mentally)
– Being overwhelmed by bills
– Running out of pension
– Being unable to pay for care
– Being forced to relocate
– Failing to keep up with house maintenance
– Loneliness
– Finding hobbies unaffordable

Unfortunately, old age happens and not even all the money in the world can prevent you from getting frailer as you go on, but the rest of the list* can all be covered by a good equity release plan!

*Money can’t buy you friends, it’s true, but loneliness is very much diminished if you can afford to visit people and go out.

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FCA disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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