Cash to make new memories
Has your home’s rising value been helping you to save for the future?
YOU’VE probably seen the value of your home increase over time and this could mean you may be able to use some of this equity to release a cash sum.
You might not look on your home as part of your financial planning, but if its value has gone up, you may have been saving for your future without realising it. So, how could you use the money? Well, perhaps you need to make improvements or adaptations to your home as you get older, meaning you can stay put even if health and mobility become a concern. Maybe you could help your children get on the property ladder, contribute to your grandchildren’s education, or use the cash for special treats, such as a holiday or car.
If you’re over 55 and own your own home, you may be able to unlock some of your equity and turn it into tax-free cash with a lifetime mortgage.
If this is suitable for you and you’re eligible, it’s a way to access money tied up in your home, without having to move. There are no monthly repayments. The loan and interest are repaid usually from the sale of the house when you die or go into long-term care, subject to terms and conditions. Interest will be added each year. Interest will be charged on the loan and any interest already added which quickly increases the amount you owe, although you may have the option to make limited repayments after you’ve had the loan for a certain length of time.
A lifetime mortgage will reduce the amount of inheritance you can leave and may affect your tax position and eligibility for welfare benefits.
If the provider has an inheritance protection guarantee, this lets you safeguard a percentage of the value of your home to leave to your loved ones.