If you need to free up some cash quickly and you own your own property, you have several options available to you. The first and most popular option is to remortgage your home – this is essentially taking out a loan against part of the value of your home which you pay back over a number of years while retaining ownership of your property.
Another option if you are looking to sell or require a larger amount, is to find a company that buys houses fast for cash. These companies won’t offer you the highest amount for your property but they will potentially offer you the fastest way to get your hands on a large amount of money. This is a great option if you are moving house and your buyer pulls out and you want to stay in a chain, or if you need finances for unexpected fees such as funding a care home or large medical bills.
Equity release is another option, this allows you to cash in a part of the value of your house while still being able to legally live there. There are many reasons that people choose to do this, some of which will be covered in this article. There are also a few different ways you can go about releasing the equity on your home – we will also go through these and make sure that you are fully understanding of what this means and what rights you will have.
Knowing all of the facts before you make any final decision will stop you from being scammed or losing out on money that you could otherwise have.
As a quick introduction, equity is the difference between the current market value of the property, and the amount the owner still owes on the mortgage. The part of the house which is mortgaged is technically owned by the bank, until the owner has paid back the mortgage. Equity release involves making this difference available to the owner (either all or part of the equity) so they can make use of the cash. However, this money will be added on to the amount that they then owe to the bank – essentially becoming a new part of the mortgage.
Many people choose to release their equity for a number of reasons. One of the most common reasons is that people often need some money to do home repairs. Many people find that if damage is caused to the house that their insurance won’t cover then they can use their equity to help pay to repair this damage. Another common reason to release equity is when two home owners are splitting up the property due to divorce or separation. By releasing the equity, then the two home owners may have enough money for a deposit on another property, and they can then split up the remains onto separate mortgages.…