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Equity release dominates
New equity release lending hit £1.5bn in Q3 20221, with 29% more plans taken out by the end of September than a year previously. The average amount borrowed now comes to more than £114,000, while pressing needs and cost-of-living concerns remain more prevalent than discretionary spending.
Why release equity?
Equity release products provide access to equity that is locked up in the value of your home. There are many reasons why you might decide to access this equity:
- Repaying debts (31%) and mortgages (24%) were key reasons people chose to release equity in the third quarter
- Supporting family members (20%) was also common, with people gifting an average amount of £53,503 to younger members to help them onto the property ladder or as an early inheritance
- There was a 3% year-on-year increase in people using equity release to fund home or garden improvements and a 7% increase for holidays.
Advice is key
Equity release is not suitable for everyone. It is vital to take financial advice to make sure equity release is the most suitable option for your individual needs. We’re happy to help – get in touch.
1Key Later Life Finance, 2022
As a mortgage is secured against your home or property, it could be repossessed if you do not keep up mortgage repayments. Equity release may require a lifetime mortgage or a home reversion plan. To understand the features and risks, ask for a personalised illustration.
It is important to take professional advice before making any decision relating to your personal finances. Information within this document is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK. We cannot assume legal liability for any errors or omissions it might contain. Levels and bases of, and reliefs from, taxation are those currently applying or proposed and are subject to change; their value depends on the individual circumstances of the investor. No part of this document may be reproduced in any manner without prior permission.
The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. If you withdraw from an investment in the early years, you may not get back the full amount you invested. Changes in the rates of exchange may have an adverse effect on the value or price of an investment in sterling terms if it is denominated in a foreign currency.
Information is based on our understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from, taxation are subject to change.
Tax treatment is based on individual circumstances and may be subject to change in the future.
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