The Growing Popularity of Lifetime Mortgages

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All regions of the UK are seeing a growth in lifetime mortgages. Many homeowners over the age of 55 are drawing on equity release products to access accumulated money from their property.

Rising House Prices

House prices have risen sharply in the last year, with many parts of the UK seeing increases of more than 12%. This has seen equity rise significantly, with property owners and landlords gaining thousands in the last few years. The result is that around just 23% of UK property is owned by mortgage debt, and the rest owned in cash or equity.

Lifetime Mortgages

A lifetime mortgage is a way for older property owners to release equity and is the most popular method of equity release. It allows homeowners who are 55 or older to release money from their homes while retaining 100% ownership for life.

Lifetime mortgages are on the rise due to housing pricing increasing rapidly, with over 25% growth in some parts of the UK. Equity release loans have been affected by the increasing interest rates this year, rising from 4.1% to 5.7% up to August.

Almost 90% of products have fixed ERCs, with the majority offering compassionate repayment windows of three years. This means the loan can be repaid early without ERC after a bereavement. The chair of the Equity Release Council, David Burrowes, has commented that releasing equity is evolving and becoming a nationwide trend with improvements in flexible products to suit all needs.

Is Equity Release the Right Choice?

While Equity release is the ideal option for some, it should never be the default option, nor should it be the last resort. The best way to consider equity release is alongside all other factors and choices to establish if this is the right solution for you, your home and your financial goals.

It can be overwhelming when searching for financial information, especially with something as layered as equity release. This is why it is always best to consult a specialist, such as Equity Release Brokers, to ensure you make the right decision for your future. Arming yourself with the relevant information, facts, figures and advice will lead you to the ideal outcome.

For more information about our equity release services, contact us on 01277 620083.