Equity Release Schemes & Advice For Those Considering Them
Posted at by ifydcat on category FinanceWhen it comes to equity release schemes, many people are not very knowledgeable as to how they work. If this is something that you are considering, then you need to take the time to learn more about how they work and how they can benefit you. They can also be referred to as lifetime mortgages or home reversions. Essentially, they allow you to borrow money from the equity in your home and allow it to be repaid after your home is sold when you die.
These programs work in a unique way. They give you the opportunity to borrow money based on the equity that you have put into your home over the years. This money is then paid off once you pass away and the house is sold. There are a few different requirements that you must meet to take part in this. First, you must be 60 years old. Your home must be paid off, and must be in good condition.
You can choose to get a lump sum loan, or a regular income loan. Sometimes, you can even choose both of these options. This money can be used for anything that you want to use it for. Some people may choose to use it to purchase a new car, while others may use it to supplement their monthly income and keep up with their regular bills. Either way, it is a great way to have some extra cash when you need it.
The good part is that the money that you receive will be tax free. Although you will not have to have taxes taken out of it when you get the money, if you choose to invest it then you will likely have to pay money on any of the earnings that come from that investment. The amount of money that you receive will be directly related to the amount of equity that is in the home. Since it is completely paid for, you may find that it is a substantial amount.
What are the benefits of using equity release schemes? Well, you will find that first of all it is a great way to be able to get extra money. Another great benefit is the fact that you can still live in the home until you die. Once you die, the money will then be paid back after the home has been sold. If you do not have plans for the house after you die, then it may be a great idea for you to look into it further.
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