Home Reversion Equity Release

Published / Last Updated on 13/03/2017

Home Reversion Equity ReleaseHome Reversion Schemes Explained

What is a home reversion equity release scheme?

  • You sell the whole of your home or a share in it but still live there.

How does it work?

Home reversion company buys the share in your home.

  • You will not get market value.
  • This is because the equity release company may have to wait 10, 20 or 30 years before they get their money i.e. get their share back of your home.

Do I have to make payments?

  • No, there are no interest payments as you have not borrowed money, you have sold equity.
  • You will lose the future growth in value of the share of the property that you no longer own

Is my home safe?

  • You have a permanent right to live in your home until the day you die or sell your home or move or go into a care home

How much equity can I release?

You usually set the share you wish to sell

  • Usually this will be a mininum share that you sell e.g. 50% of the value of property.
  • Most people sell 50% or 100% of the property

Who is home reversion suitable for?

  • People who have no people to leave their money to on death
  • People who like the idea that they have sold a share of the property and retain ownership of a share

Can there be negative equity?

  • No, as there is no mortgage, you have sold a share in your home

What sort of interest rates?

  • There is no interest charged

Can I release more later?

  • If you have only sold a share, you can sell any remaining share either to the home reversion scheme or to others but only if the home reversion will allow it
  • You can sell up entirely and bother you and the home reversion will keep your own share of the property value