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Home reversion plan

A home reversion plan allows you to exchange the ownership of some or all of your property for a lump sum of cash, along with the right to stay in your property, rent-free, for as long as you live. This is also known as a 'lifetime lease'.

  • Advantages
  • Disadvantages
  • Plans are available from the age of 65.
  • The cash you release is tax free and can be spent on whatever you like.
  • There are no monthly repayments to make.
  • You know at the outset what share of your home you will be leaving to loved ones in your estate.
  • You are able to guarantee an inheritance with the remaining part of the property you continue to own.
  • The older you are, the more money you will generally be able to release.
  • You can typically raise a larger sum from your home with a reversion plan than would be available with a lifetime mortgage.
  • You can benefit from any future increase in the value of the proportion of the property that you still own.
  • Plans can allow you to protect an inheritance for your family.
  • All plans are regulated by the Financial Conduct Authority.
  • You will no longer benefit from any future house price rises on the proportion of the property that you have sold.
  • The reversion plan provider will buy at a discount to the current market value of your home because they will be giving you the absolute right to live in the property rent free for the rest of your life.
  • If you pass away soon after taking out the plan, you may have effectively sold some or all of your property, although some plans make provisions for this eventuality.
  • Reversion plans cannot usually be reversed as you are selling part of your home.
  • Your tax position and eligibility of means-tested benefits may be affected now and in the future, as might your options for moving or selling your home in the future.
  • The amount that you will leave as an inheritance is likely to be reduced.
  • If you wish to buy back the proportion of your house you sold then this would have to be bought back at market value and not at the discounted rate you sold it for.
  • Because you can continue living in your home, rent-free, for life, you would generally receive an amount for your property that is lower than its market value.

Other alternatives to equity release

An equity release plan is not the only option if you wish to free up some cash in retirement. Downsizing the property, or borrowing money from a close friend or family member, could be a preferable alternative to releasing equity from the home.

Please call us today for a no-obligation chat on  Freephone 08080 555 222.  Our friendly advisors are ready to answer any questions you may have.

Equity release may involve a home reversion plan or lifetime mortgage which is secured against your property. To understand the features and risks, ask for a personalised illustration.

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Things to consider

As multi-award-winning equity release specialists we provide impartial advice covering your options as well as explaining what impact a plan could have on the size of your estate and if your entitlement to current and future means-tested benefits could be affected now or in the future.

We provide initial advice for free and without obligation. Only if you choose to proceed and your case completes would a typical fee of 2.2% of the amount released be payable.

Equity release requires paying off any outstanding mortgage. Equity released, plus accrued interest to be repaid upon death, or moving into long-term care.