What is equity release?

Your equity is calculated as the difference between your home’s value and any outstanding debts, such as a mortgage or loan secured against the house. Equity release allows homeowners aged 55 or over to access some of their home’s value, tax-free, to help their family, improve their home or supplement their pension.

What Equity Release schemes are available and can I be forced out of my home?

No, not if you decide to take out a lifetime mortgage. The loan is secured against your home and does not affect the ownership. You will still own your home and it will remain your asset. You can carry out home improvements and add extensions – and in fact, many of our clients decide to release equity for this very reason!

A home reversion plan means selling a stake in your home in return for a cash lump sum. By selling a share of your property, you will still own part of the property, but continue to enjoy the right to live in it for the rest of your life.

Can I move to a new house?

We are members of the Equity Release Council and all plans we provide are approved by the Council. This means, under a lifetime mortgage you can move whenever you like. You can transfer your mortgage to your new home. However, if you take out a home reversion plan, you will not own all your property.

A home reversion plan means you sell all or part of your property in return for a tax-free sum, a regular income or even both. You will stay on your home; however, you will not pay rent, and you can stay in the property until you enter long term care or death.

Can I release equity if I have not paid my mortgage in full?

We offer several policies which allows you to release the equity tied up in your home. As long as your aged 55+ (and have a % of equity in your home), you do not need to have fully paid off your mortgage.

Am I eligible for equity release?

There are certain conditions you must meet before being able to take out equity release. For a lifetime mortgage you (or both of you, if you are borrowing jointly) need to be at least 55 years old. For a home reversion plan you (or both of you, if you are taking out a plan jointly) need to be at least 65 years old.

How much equity can I release in my house?

There will be some variances, but you can usually borrow up to 60% of the value of your property. How much can be released is dependent on your age and the value of your property.

Do I have to pay tax on the money I release?

No, you will not have to pay tax on any money you release from your home. The money you receive is tax free, however, if you do not spend the money released immediately, and put it into savings accounts (for example), it could be liable for tax.

Is a good credit record essential?

It depends on the type of plan you choose. If you opt for a home reversion plan, you will not need to make monthly payments, so it is impossible to default, meaning your credit history is immaterial. The cash in your home you own, essentially makes the interest payment for you, therefore you cannot default.

Can my house be reposessed?

Evolve Lifetime is approved by the Equity Release Council (ERC), which provides a number of guarantees. One of which is Tenure for Life. This means that the property is not and never will be at risk of repossession, as there are no contractual repayments needed or expected during the borrower’s lifetime.

Will I end up owing more than the house is worth?

No, if the property is sold for less than the outstanding mortgage, the difference is written off. This is due to the protection provided by the Equity Release Council’s No Negative Equity Guarantee.

Will equity release impact how much inheritance my children receive?

When you release equity from your property, you reduce the value of your estate. This will most likely reduce the amount of inheritance tax payable on your death. In some cases, this could take the value of the estate below the IHT threshold of £325,000.

What happens if I move into long term care?

You have the right to live in their property until you die or enter permanent long-term care. If you need to move into a care home, and your application was made in joint names and only one of you needs to move into care, then your partner will remain living at home for the rest of their life or until they need to enter long term care.

Will my family end up in debt because of equity release?

Absolutely not. All our plans meet the Equity Release Council standards, and you will never owe more than the value of your home. This means that any debt you accrue through equity release cannot be passed on to your family.

Are there any disadvantages?

Unlocking cash from your home will reduce the value of your estate and, if you do decide to keep the money in a savings account, it may affect your current/future eligibility for means-tested state benefits.

If you move out permanently to a care home or, in the event pf your death, your property will be sold to repay the provider first. The money left after the sale of the house and repayment to the provider will go to your estate to leave as an inheritance.