Equity release products

Equity release products are good for senior citizens. This can be a strategy that maybe the answer for you if you wish to remain in your home during your golden years. Many seniors are finding themselves in a situation where they are living on a fixed income and are having difficulty paying their bills. Struggling to pay the bills during your golden years is no way for anyone to live.

These equity release products help seniors convert their home equity into cash allowing them to remain in their homes until they either move out permanently, sell their home or pass away. The basic requirements are homeowners must be 62 years of age or older, there is no income or credit check and no monthly payments giving seniors financial freedom.

Home Reversion Product:

The homeowner can take out the exact amount of the home’s value and the homeowner can stay in the house until the home is sold. Under this equity release product you cannot leave the property to your heirs because when the property is sold a portion of the sale’s proceeds are paid back to the reversion company.

Lifetime Mortgage Product:

The homeowner will take out a loan and the principle and interest are not paid back, instead the interest accrues and is added back into the loan. The balance is paid when the home is sold. If there is money left over from the proceeds it will go to the beneficiaries. If not, the beneficiaries will have to repay anything over and above the value of the home from the estate. To prevent this from happening, most lifetime mortgages have a no-negative-equity guarantee. This guarantee promises that you or your beneficiaries won’t have to pay back more than the value of the home. There are several types of plans available i.e. a roll-up mortgage, a fixed repayment lifetime mortgage, an interest-only mortgage, and a home income plan.

Shared Appreciation Arrangement Product:

This lets the homeowner sell a percentage of the home to the lender. The homeowner agrees to give up a portion of the homes “future” appreciation value while receiving a lump sum of the “current” value of the home. This will give the reversion company a share in your homes value.

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