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Home reversion plan

A home reversion plan is a type of equity release that is less popular than the alternative, which is a lifetime mortgage. A home reversion plan allows you to exchange the ownership of some or all of your property for a lump sum of cash; in addition to giving you the right to stay in your property, rent-free, for as long as you live subject to the lenders terms and conditions. This is also known as a ’lifetime lease’ and is only available to those who are aged 65 or over.

Age Partnership equity release services offer home reversion plans as part of the equity release product range. We also provide lifetime mortgage advice with access to preferential plans from a wide range of leading lenders.

  • Advantages
  • Disadvantages
  • The cash you release is tax free and can be spent achieving your goals.
  • There are no monthly repayments to make as no interest is payable.
  • You can benefit from any future increase in the value of your property from the proportion you retain.
  • 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.
  • Plans are portable which means it is possible to move home in the future, subject to criteria.
  • You can remove your home entirely from your estate to reduce any potential inheritance tax.
  • 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.
  • Plans can allow you to protect an inheritance for your family.
  • If you sell 100% of your property, there will be no property value to leave to your beneficiaries.
  • There is no scope to return for further funds in the future when you sell all of your property.
  • If you die shortly after taking out a home reversion scheme, your estate will receive less as the full market value is not given at the outset.
  • It’s expensive to reverse - the property would have to be purchased from the reversion lender at the full market value.
  • It may impact the size of your estate and may affect your entitlement to means-tested benefits either now or in the future.
  • Not available to anyone under the age of 65.
  • 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.
  • Plans are portable, however if you decide to downsize you will have to pay some of the money back.

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.

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

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Things to consider

As multi-award-winning equity release specialists we provide informative advice covering your options as well as explaining how equity release will affect potential inheritance and how your entitlement to 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 £1,795 be payable.

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