The release of capital continues to grow in popularity. The average size of new loans grew by 6 percent year-on-year, matching the latest inflation figure and surpassing the 11 percent annual increase in housing prices in the UK, which added £27,000 to the housing average. A capital release provider will provide you with a lump sum or income in exchange for a portion of the value of your home. This is achieved through a type of mortgage or by selling that part of your home on the condition that you can continue to live there as long as you want.
Older homeowners accessing the value of their homes through life mortgages and other forms of capital release are directly adding nearly £1.8 billion in gross value added (GVA) across the UK economy. As interest rates rise and fall, equity release mortgages are naturally influenced and interest rates vary Please note that all calls are made by Key Equity Release, the UK's leading equity release specialists. This means that for every £1 spent as a result of the capital release, a total of £2.12 was supported in terms of economic activity across the UK economy. Check the status of your benefits If you are receiving benefits in addition to the state pension, check how they could be affected if you used the capital release.
The obvious advantage of freeing up capital is that it gives you money to spend now, rather than leaving you locked up in your house. The main disadvantage of freeing up equity is that it doesn't pay you the full market value of your home. Releasing capital can provide you with a large sum of money to spend and at the same time allow you to continue living in your home. There is a significant range of interest rates for capital release and, therefore, you should try to find the best rate for your circumstances.
Releasing capital is a way to unlock money trapped on your property tax-free while staying in your own home. Always ensure that you speak with a specialist capital release advisor and that both the capital release advisor and the capital release provider are authorized by the FCA. The release of capital can affect any benefit you receive and can have an impact on any benefits you may be entitled to in the future. Your financial advisor or mortgage advisor can help you decide if a capital release plan is appropriate or if you should consider other options, such as reducing your headcount.
Releasing capital is a way to free up money from your home without having to move, but it comes with certain risks. If capital release is the right choice, they will provide you with a recommendation of the type that best suits your needs. While the release of capital has become much more common and commonplace, lifetime mortgages can be complex products with disadvantages.