A house is one of the most expensive things that people purchase. This is true whether you are purchasing your first home, or one to move into after retirement. It’s important to take care of your home and design it properly to get the most out of your investment. There are many ways you can increase the value of your home, but what happens when you need more money? If you have equity release, you may be able to improve the design of your house while also getting cash for other expenses.
Equity release can help homeowners keep their homes while making home improvements without worrying about paying off mortgage debt at the same time. The best part about equity release is that there are no penalties or disadvantages when using this form of financing. It’s not like taking out a loan where interest rates apply. Instead, an individual pays back the capital they borrowed plus interest over time with regular monthly repayments which fit into their current lifestyle without impacting future retirement plans.
You might be wondering why this type of financing is so important? Well, in this article John Lawson, an Equity Release Expert reviews some Aviva equity release plans. He will also discuss here how you can use equity release to make your house design dreams come true.
Using Equity to Make Renovations to Your Home
Older homeowners can release equity from their homes to cover the cost of home improvements. The most common equity release product is a lifetime mortgage, which allows you to release a portion of your home’s worth as a tax-free cash lump sum.
The loan and interest which accumulates over time are normally only due to the equity release provider when you die or enter long-term care, rather than on a monthly basis. This is usually accomplished through the selling of the house.
If you’re concerned about interest rollover, there are ways for making voluntary contributions toward your mortgage. If you want to cease them, you can do so at any time without incurring any penalties.
Is Equity Release Right for You?
Equity release plans are intended to be a long-term commitment, so if you change your mind, need to move, or wish to use your equity for something else in the future, you may be severely restricted. If you do decide to take one out, you should see if you can get a better offer after the early-repayment penalty period has passed. This is especially true at a time when interest rates are at record lows.
You should seek the advice of a qualified equity release expert to better understand your needs as there are many things to consider beforehand and to ensure that they provide an offer that is the best solution for you. They’ll go over the various options with you and explain that choosing one affects the value of your estate and may have an impact on any means-tested benefits you may be entitled for.
If you have equity in your home, it may be a good idea to consider using that equity for renovations. This is an investment that will not only increase the value of your property but also give you peace of mind with less financial risk. Equity release can help homeowners improve their house design and get back on track financially without being at high-risk from fluctuating interest rates or unexpected repairs. The benefits of home equity release are manifold.
We’ve provided you with some valuable insights into how an equity release can help you on your finances, but we encourage you to explore further and contact a financial adviser to explore your options.