Types of equity release
There are two main ways to access the value in your home: you could either take out a lifetime mortgage – a long-term loan secured against your home – or choose to sell all or part of your property using a home reversion plan.
A lifetime mortgage enables you to release a tax-free cash lump sum from the value of your home. You will still own your home and can continue to live there for as long as you like.
What is a lifetime mortgage?
Much like a traditional mortgage, a lifetime mortgage is a loan secured against your home, which accrues interest each month. The difference is that you don’t have to make monthly repayments. Instead, the interest is compounded, so unless you choose to make full monthly interest payments, you will pay interest on the interest. The loan is usually repaid using the proceeds from the sale of your property and will reduce the value of your estate.
The Saga Lifetime Mortgage
The product available through Saga Equity Release is the Saga Lifetime Mortgage, which is available exclusively through this service and is provided by Just.
The Saga Lifetime Mortgage offers a range of flexible options and can be tailored to meet your individual circumstances. These options include whether or not you'd like to receive your money in one lump sum or a smaller amount initially, followed by additional amounts as and when you need it from a pre-agreed limit. You can also choose to pay off some or all of the interest, to help reduce the overall cost of the loan. Certain health conditions and lifestyle factors can also be taken into account which could mean that you are able to borrow more or benefit from a preferential rate, in comparison to individuals who don't have these health and lifestyle conditions.
Find out how much money you could release with a lifetime mortgage by using our equity release calculator. Please note that your entitlement to means-tested state benefits could be affected if you release equity – an adviser from Saga Equity Release can check this for you.
Call the team on 0800 096 7120. Lines are open Monday to Thursday, 9am to 8pm and Friday 9am-5.30pm (excluding bank holidays). Alternatively, you can request a call back from one of the team.
Home reversion plan
With a home reversion plan you sell part or all of your home to a provider and receive the proceeds of the sale in cash, as either a single lump sum or regular instalments.
Will I still be able to stay in my home?
Home reversion plans include the right to stay in your home rent free for the rest of your life. Unlocking cash in this way could affect any means-tested benefits you receive, and you should check this before deciding on a plan.
How much will I get for my property?
It’s important to note that whether you sell a proportion or the whole of your property to a home reversion company, you won’t receive the full market value. This is because they will not be able to re-sell the property while you’re still living there, and they will want to avoid any potential loss in value during the time you remain in the house.
When you die or move permanently into long-term care, the property will be sold and the estate will be reduced by the proportion of the property’s value that is repaid to the provider.
To find out more, call Saga Equity Release on 0800 096 7120. Alternatively, you can request a call back from one of the team.
Lines are open Monday to Thursday, 9am-8pm and Friday 9am-5.30pm (excluding bank holidays).
Please refer to our Important information to find out more about the service and fees.