How Equity Release May Benefit You Or Your Family In A Difficult Situation - By: Felicity Lightbody

For UK homeowners who are 55 or older, an interesting way to bring in additional revenue to supplement their retirement income is an equity release scheme. An equity release scheme allows homeowners to tap into the equity of their home and receive money from that equity in the form of a loan. This can be a tremendous help financially to retiree's who are living on a fixed income or are struggling to pay their bills. Alternatively, an equity release can be used to help someone live that lavish lifestyle that they have always dreamed about. However someone may want to spend the money they receive from an equity release, is up to the recipient.

One of the good aspects of tapping into a home's equity through an equity release is unlike a home equity loan there is no monthly loan payments to make. With an equity release there is no repayment of the loan until the last survivor of the estate either dies or is put into care. After this happens the home is sold to repay the loan plus any accrued interest. Under this plan, someone gets to live in their house as long as they live, additionally their spouse will be able to remain in the house after the passing of their husband as long as they live; so there is no danger of participants in an equity release scheme being without a place to live.

Here is an example of a situation where an equity release might be applied. Bob and Sue are an elderly couple who just recently retired, Bob is sixty and Sue is fifty-eight. Bob's retirement plan is enough pay the monthly bills and still be able to save a little; Sue has very little income and due to age and health issues has no earning potential. However, during the course of their lives they have been able to pay off their mortgage and the value of their property has increased substantially. Then it happens, Sue is diagnosed with a serious illness, one that is rare and will require them to travel to the States for immediate treatment or she will die. Bob exhausts his savings and still does not have enough to make the trip to the States for the treatment that she needs. Bob then hears about an equity release scheme, Bob was hesitant about a home equity loan because he was apprehensive about how he would pay it back, but he heard about an equity release scheme where there was no monthly payments. This plan suites Bob just fine, he took an equity release on his home and had enough money to fly Sue to the States, pay for her treatment, and money left over to take road trip and see scenic America before heading back to the UK.

Of course, Bob and Sue are fictitious characters, but this story illustrates a practical way that an equity release can benefit someone. If someone has worked hard and built equity in their home, there is no reason why that they should not be able to enjoy the benefits of that investment.

About the Author

Felicity is a freelance writer, writing infrequent pieces in the UK about equity consultants in Yorkshire. For more advice on equity release and what it can mean for your lifestyle, please visit equityreleaseconsultants.co.uk

Article Directory Source: http://www.articlerich.com/profile/Felicity-Lightbody/39388

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