What Are The Alternatives To Releasing Equity In Your Home?
Equity release is a popular solution for many people looking to capitalise on the value of their property, and access funds to enjoy spending on home improvement projects, to clear other debts, or even to help children or grandchildren to take their own first step onto the property ladder. Yet, as with any kind of financial agreement, releasing equity from the home isn’t going to be right for everybody. Read on to discover the alternative options that could be available to you.
Move To A Less Expensive Property
Many people decide to downsize as they become older, or as their children grow up and leave home. After all, there may not be the same need for a large family house and the effort to keep it clean and maintained can be costly and time-consuming! Moving to a smaller property can give you the freedom to enjoy your retirement and can give you a cash boost too. After all, a smaller property is likely to cost you less than your family home will sell for, with the added bonus of saving on energy costs such as heating. Of course, you will need to factor in the additional costs of moving house, such as removal services but expert solicitors such as Parachute Law can provide advice and will work to minimise the costs of conveyancing.
Take On A Tenant
Of course, many people choose equity release precisely because they cannot bear to leave their long-term home. If this is the case, you will still have other options to explore. If your income is sufficient, you may be able to remortgage your home, or access other types of finance.
Another popular solution is to take in a lodger, which is a great solution for many couples with a bedroom or two to spare. Under the current regulations, you can bring in up to £7500 a year in rent before being required to pay any tax. It can also work out as a great way to get a bit of extra help about the house and garden!
Simply taking a stricter approach to your budget can also free up a surprising amount of extra cash. There may be regular outgoings that can be trimmed back or eliminated completely, or you could try switching to lower-cost options for shopping or hobbies. For example, rather than pay an expensive private gym membership, as a pensioner, you could use your local leisure centre’s facility at a discounted rate.
Consider Organisations That Can Help
If you feel that releasing the equity from your home is your only choice for clearing debts or meeting other financial obligations, then be sure to reach out to organisations that can offer advice. If debt is the main motivation for you, then get in touch with Stechange to find out if there are alternative solutions. If you need the money to pay for essential home renovations, for example, if you or your partner need to accommodate mobility needs, then speak to your local council to find out about funding or loans.
It could even be the case that your family will be glad to help you with your finances, so be sure to discuss your plans before committing to releasing equity from your home.