Equity Release Solicitors

What is equity release?

Put simply, equity release is a way in which homeowners can turn the value of their homes into a cash lump sum. The conveyancing Solicitors at Eric Robinson are specialists when it comes to advising clients on any aspect of an equity release loan.

Equity release mortgages are a special type of mortgage that are generally not intended to be repaid during your lifetime. They usually become repayable on death, or on the homeowner leaving their house to move into long-term care.

Your equity release lender will require you to obtain specialist legal advice from an equity release Solicitor before you sign up to an equity release mortgage so that you are fully conversant with the key terms and conditions, and to ensure that the mortgage meets your requirements.

There are two types of equity release scheme:

• Lifetime mortgages – When you take out a lifetime mortgage a loan is secured against your property, the amount of the loan depends on the value of your property. The cash can be paid to you in monthly instalments or in one lump sum. You retain ownership of your house so that it forms part of your estate and the loan is paid back once it’s sold upon your death or following a move into long-term care.
• Home reversion – Home reversion plans allow you to sell either your property or a share of your property to an equity release provider. You’re then able to live their rent free until you die or go into long-term care.

Generally, to qualify for equity release plans clients must be a UK resident, your age must be 55 or over and you will need to own your own home. The Equity Release Council will be able to recommend providers and authorised and regulated equity release lenders. You should always ensure that you obtain lifetime mortgages from advisors who are governed by the Financial Conduct Authority. Some providers offer an equity release calculator so that you can obtain details of the amount that you could borrow. Theses calculations will be based on the market value of your home as well as the amount of any existing mortgage.

Do remember that the rules of most drawdown lifetime mortgages require that you must first pay off any outstanding mortgage with the money you release. After that, the rest is yours to do with as you would like. Some people choose to make home improvements whilst others choose to pass the money on to family members.

Pros and cons of equity release

It is important to consider the advantages and disadvantages of equity release to ensure it is the right option for you. Pros include (but are not limited to):

• You’ll receive a tax-free lump sum and there are no monthly repayments
• You can stay in your home and you will still own it 
• May assist with reducing Inheritance Tax

It is also imperative that you consider the cons that can be associated with equity release also. Such as (but not limited to): 

• You may have to pay early exit fees 
• You can’t take another loan against your property 
• It may affect your state benefits 
• Compound interest 

We will ensure that you fully understand the type of equity release that you wish to pursue so that you can confidently decide whether it is right for you. 

How can I release equity from my home? 

Generally, to qualify for equity release plans, clients must be a UK resident, your age must be 55 or over and you will need to own your own home. 

The Equity Release Council will be able to recommend providers and authorised and regulated equity release lenders. You should always ensure that you obtain lifetime mortgages from advisors who are governed by the Financial Conduct Authority. 

Some providers offer an equity release calculator so that you can obtain details of the amount that you could borrow. These calculations will be based on the market value of your home as well as the amount of any existing mortgage.

Do remember that the rules of most drawdown lifetime mortgages require that you must first pay off any outstanding mortgage with the money you release. After that, the rest is yours to do with as you would like. Some people choose to make home improvements whilst others choose to pass the money on to family members.

How can our equity release Solicitors help you?

Equity release is complex, therefore it’s important to have a Solicitor on board who can let us guide you through the process and provide information that ensures that your chosen equity release plan works for you.

Unlike some law firms, at Eric Robinson we have a team of expert Solicitors specialising in equity release. We aim to offer sound legal advice and support throughout the equity release process.

If you want to speak to an advisor, please don’t hesitate to get in touch. Phone or email any of our offices today and members of our equity release team can talk you through the legal services we offer and help you understand what your options are going forward. 

To speak to us and find out more, get in touch with one of our local branches at the following locations: Southampton, Hedge End, Chandlers Ford, Winchester, Lymington, or Richmond Upon Thames.