When you’re retired, you might want to escape the financial burden of your mortgage. By paying it off early using equity release, you can reduce your monthly costs. And with more money in your bank, you can enjoy doing the things you love in life.
In this article we look at paying off your mortgage using equity release. We’ll explore how it works, as well as some of the benefits and risks.
Yes, equity release can be used to pay off your current mortgage. However, your ability to do so depends on two things:
If you're able to release enough money, your monthly mortgage payments could soon be a thing of the past. To get a quick idea of how much you could release, you can use our calculator.
Using equity release to repay an existing mortgage or debts may cost more in the long term. You should get expert advice first.
If you can afford to pay off your mortgage before the end of its term, you could save money on interest payments. But there are key things to consider first:
Paying off your mortgage using equity release could boost your finances in later life. It also allows you to stay in your own home. And, if you have money left after paying off your mortgage, you could:
Using equity release to repay debts may cost more in the long-term. Gifting money may be subject to inheritance tax and will reduce the size of your estate.
If you’ve owned your home for a while, it may have risen in value since you took out your mortgage. This added equity could be used to pay off your debt.
A lifetime mortgage is the most popular type of equity release. It is a loan secured against your home.
What are the benefits?
What are the risks?
Before taking out equity release, you should get professional financial advice. Saga Equity Release is a no-obligation advice service. It's here to help you find out if equity release is right for you.
Provided by HUB Financial Solutions Limited
Find out all you want to know about equity release with expert advice.
First you need to see if you can release enough equity to pay off your existing mortgage. You can get an idea of this by using our calculator. If the amount is lower than your current mortgage balance, you’ll need to be able to raise the extra funds.
Your mortgage needs to be paid off fully before or as part of an equity release arrangement. If you have a successful equity release application, your solicitor will transfer the funds to your original mortgage provider. This will clear your existing mortgage. If there are any funds left over, they’ll be sent to you.
It tends to take six to 12 weeks to release equity from your home. But it can take longer if there are any hold-ups. The process is a bit like buying a house, so it's never instant. If you want to find out more, request your free Saga Equity Release guide.
Chat to an expert and find out if equity release is right for you. Or request a callback at a time that suits you.
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Provided by HUB Financial Solutions Limited
Find out all you want to know about equity release with expert advice.
You could release tax-free money to pay for work on your property.
From set-up fees to interest rates, we look at the cost of equity release.
