Equity release: it’s still your home
12 June 2019
If you decide to release equity from your home under an equity release scheme, you will still be the legal owner, but exactly how the ownership is calculated will depend upon what type of product you opt for. If you have a lifetime mortgage, you remain the only legal owner of your home. But if you opt for a home revision scheme, the home reversion company effectively buys an agreed proportion of your house; however you can sell nearly all of your house (up to 99.9%) and still remain the legal owner of your home, even though you may only directly own 0.1%.
If you take out a mortgage provided by a member of the Equity Release Council, you will be guaranteed that you will never be thrown out of your home, as long as you keep to the terms of the agreement. You will also have a ‘no negative equity’ guarantee, meaning you or yours heirs will not end up owing more money to the equity release company than your home is worth.
Your rights and responsibilities as the owner of your home
As a homeowner, you already enjoy certain freedoms, but you will also be aware that you have to look after your home. It will probably come as no surprise to find out that this is very much how things are if you take out an over 55 equity release scheme:
- Property maintenance: You will be required to maintain your property to at least the condition that it was in when you took out the equity release scheme.
- Home alterations: Most equity release companies are happy for you to make modifications to your home – especially if they add value to your property – as long as you get their written consent prior to undertaking any work.
- Moving home: Whether you want to move house to be nearer family, to have a home that is easier to maintain or to enjoy an area of the country you’ve always loved, you should still be able to do so. There are some terms and conditions attached, but these are explained in full here.
Equity release can be a helpful solution to help you realise your retirement dreams – without giving up legal ownership of your home.