Could equity release help you move home?
9 April 2021
Moving house in later life
For many of us, our mid-50s mark a new chapter in our lives: the kids have flown the nest, we’re approaching retirement and we might be starting to think about the future, such as home care and getting a future-proof home. For these reasons, lots of people start to reconsider where they want to live in their mid-50s.
Unfortunately, if you’re looking to move house later in life, you may not qualify for a conventional mortgage. Legally, there’s no upper limit on how old you can be when applying for a mortgage, but most banks have age limits which mean that you can’t be over a certain age when you’d finish paying off the debt, this is usually around 70 or 80 years old. This is where equity release can come in hand, as it can enable those looking to move who don’t qualify for a conventional mortgage to get a loan.
Reasons for over 55s moving
There are lots of different reasons why you might consider moving if you’re over 55, including:
- Downsizing: This may be because the kids have left home, or because you’d prefer a property without stairs, or to ensure that you have a house you can afford in retirement – whatever the reason, downsizing is a key motivation for many moves later in life. If you’re in this position, it’s likely that you’ll be able to fund a lot of your new property through the sale of your old house, but if you’re a bit short, or if you don’t want to use up all your savings on one purchase, releasing equity could help you purchase your new home.
- Moving closer to family: As we get older, our priorities shift; for many people, this includes wanting to be close to family to be able to see grandchildren and to be near loved ones should we need a helping hand. If you’re moving to be closer to your family, there’s a good chance the area you’re moving to could be more expensive than where you currently live, if this is the case, and you need a bit of extra cash, equity release could help.
- Not qualifying for a traditional mortgage: As we’ve already touched upon, some banks won’t lend to people over a certain age, lots of people turn to equity release as an alternative to a conventional mortgage.
- To buy a second home: Equally, perhaps you’re looking to get a little cottage out in the country, or a second property nearer to family that you can visit on the weekends. If you’re looking to buy a second home, you won’t be able to use the cash from the sale of your existing property and so equity release could help you with the cost.
- Holiday home abroad: If you’re looking to buy a second home outside of the UK (and why wouldn’t you), releasing equity is one way to help purchase it.
How to use equity release to move home
If you’re looking to move home and would like to consider whether releasing equity could be a way to make this happen, the best way to consider your options is to work with one of our trusted advisers. Our advisers are specially trained to be able to take into consideration your current circumstances and the type of property you’re looking to buy and, from this, will be able to devise a plan especially tailored for you.
Our founder and Managing Director, Jan Johnson, said: ‘We’re getting loads of enquiries from homeowners over-55 at the moment, and one of the main reasons they’re coming to us is because they want to move house. With the stamp-duty holiday being extended and the uncertainty from Brexit lifting, lots of people are wanting to relocate and it’s no different for those later in life. Unfortunately, many people in this age category won’t qualify for a traditional mortgage, that’s why we’re so thrilled to be able to help so many people realise their dreams of moving through equity release.’
If you’re moving and would like to understand whether releasing equity could help you make this dream a reality, then please get in touch.