Equity release is money you receive for your home without having to sell it. It is nothing but a value for your house which you receive in the form of tax free cash.
Equity release can be paid as one lump sum or on a more regular basis.
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Regular income
Cash which is received on a monthly basis is treated as regular income. This regular income can be used in a similar way in which you use your salary. This proves to be a beneficial option for retired people. They do not have to depend on anyone for their basic needs and can spend this extra income on leisure activities or by utilising a drawdown equity release scheme they can use it to provide additional payments in the future.
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Investment
The lump sum payment allows a person to use it as they choose. This money can be used for investment purposes of which the main one is in a further property. This could be to buy a caravan or a second property for rental or holiday purposes. More commonly it is being used to assist children to get on the housing ladder by way of gifting them the deposit.
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Financial security in old age
Equity release is a way to protect you financially in old age. A higher percentage of the value of your home is paid to older people. The equity release loan is paid only to the title owner of the property.
Tags: drawdown equity release, Home Income Plans, impaired life, income plans
