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Should Pensioners Consider Signing Their Properties For Equity Release, What are the Options?

Updated on May 17, 2013

With inflations for pensioners in the UK hitting an all-time high of 9pc, the need to have a stable source of income becomes even more imminent. The question that has caught many people is whether Low rate Equity Release with cashback promise is a better option than other options. However, for people with an insider understanding of equity release, it remains one of the best ways to battle financial demons in their retirement years.

85% of retirees in the United Kingdom are on equity release and here are the reasons we believe you should be in the same scheme too.

Equity Release lets retirees above 55 years get an income from the value of their property while they are still living in.
Equity Release lets retirees above 55 years get an income from the value of their property while they are still living in. | Source

Benefits of Equity Release

Easily Accessible

There are relatively very few financial schemes for pensioners available. Equity release addresses the financial woes of seniors in a way that few other financial schemes have been able to do. With equity release, you get money as a lump sum or in regular small releases. Online calculators can help you estimate which arrangement will best work for you.

No Monthly repayments required from you

Equity release offers you ‘a loan’ without requiring any payment from you for the rest of your life. The money they lend you is only recovered after the last surviving member of the household passes away.

Easily Offset your mortgage balance

For pensioners who are still paying their mortgages, equity release offers the most stress-free way to offset your mortgage. Part of the money you get from the equity release providers is automatically used to pay off your mortgage.

Mitigate your beneficiaries from paying high inheritance taxes

With the price of property having risen so drastically in the past few years, there is a probability that your heirs will be liable to heavy inheritance tax payments (up to 40%). This means that if your house is valued at €600,000, your beneficiaries would end up paying up to €80,000 in taxes. You can mitigate the probability of having your beneficiaries pay high taxes by reducing the amount of wealth tied on your property taking equity release. Use our online equity release calculator to estimate the value of your house before and after taxation.

Equity release gives you the right to remain in your home

With equity release, you can easily offset your mortgage and continue living in your house rent-free. There are very few other financial options available for pensioners that offer the same amount of benefits that low rate equity release with cashback offers.


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