Equity release interest rates at an all-time low

17 March 2021

Low interest rates when releasing equity 

Homeowners over 55 are well placed if they’re considering releasing equity, as figures from Moneyfacts show that interest rates are at an all-time low. This means that if you’re looking into whether a lifetime mortgage might be right for you, you’re likely to pay back less money on top of what you borrowed than if you had released the same amount of capital previously. 

These low interest rates will come as welcomed news to many homeowners over 55 throughout the UK, as an increasing amount of people turn to releasing equity amid the financial uncertainty caused by COVID-19. As a company, we’re speaking to a lot of people who have been prompted to consider equity release as a result of the financial consequences of the pandemic. With lockdown continuing, we are seeing redundancies, furlough and ongoing business uncertainty which are causing financial worries up and down the country. In some instances, equity release can provide an appropriate long-term financial solution, but we will always advise clients if equity release is not right for them or there may be a more suitable alternative for their particular circumstances. 

A record number of equity release products 

The good news doesn’t stop there! The same report by Moneyfacts also found that there are a record-breaking number of products on the market for equity release customers to choose from. The analysis found that in February 2020 an equity release customer would have had 405 products to choose from, whereas only a year later in 2021 there would be 488 different plans available, meaning that you’re more likely to be able to get a plan that works better for your specific needs. 

However, this variety can be overwhelming. How can you possibly narrow down a choice of 488 products down to just one solution? This is where it’s so important to work with an equity release expert. At 55Plus Equity Release, we never adopt a one size fits all’ approach to equity release, we work with our clients to develop a specific plan that considers all their individual circumstances to ensure that you get a plan that works for you both financially and personally. 

That’s why we never use price comparison sites. We don’t believe you can simplify a person’s unique situation into a few tickboxes and we always strive to deliver personalised and client-driven results. If you’re considering releasing equity now to make use of historically low interest rates, then it’s really important you speak to a professional. 

How does equity release work? 

Equity release enables homeowners over 55 to release some of the capital in their home, enabling them to have enough finances to realise their goals, which can often involve things such as paying off an existing mortgage, financing home improvements, helping out friends and family or improving their retirement finances. 

There are two different types of equity release schemes: lifetime mortgages and home reversions. Lifetime mortgages are the most common and they mean that you’ll retain ownership of your home; it’s important to remember that you continue to own your home and the loan does not need to be repaid until you either pass away or move into a residential care home. 

Our founder and Managing Director, Jan Johnson, commented: At 55Plus Equity Release we put the client at the centre of everything we do, that’s why it’s great to see equity release interest rates hit an all-time low, as it reduces the amount of money that customers will have to pay back on their loan. It’s also good to see so many products available on the market, but clearly the best way to make sense of them all is to talk to a specially trained adviser who can guide you through the process. If you’re looking to discuss whether releasing equity could be an option for you, then myself or a member of the team will be more than willing to help.’ 

If you want to find out about the low interest rates and the rise in the number of products available in the equity release sector, then please get in touch.

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