During their service tenure, the individuals have the opportunity to save a particular percentage of their income every month to ensure future financial stability in life. Few people, due to some urgent family requirements, don’t get a chance to save any money, while some are addicted to luxuries, which compels them to make unnecessary expenditure. As a result, after retirement, these individuals do not receive significant pension to lead their life. Equity release, in such a scenario, appears to be a scheme that gives a new direction to their deteriorating lifestyle.
To enrol into the scheme of equity release, it is quite essential for the retirees to be aware of the eligibility criteria required to be fulfilled. The first among the requirements is the age the age of the applicant, which needs to be at least 55 year and the next is having an ownership of well-maintained household. The value of the property is the factor examining which the lenders determine the release equity amount that the old individuals are eligible to receive in addition to their pension. The value, however, completely depends on how maintained the property of an applicant is.
The lenders allow the retirees to stay in thei
r own house and thereby draw a significant income in lieu of it. In return, they also need some guarantee. Before approving an equity release application, the lenders visit the asset of the applicant to make sure the retirees would return the debt on time, either when they are alive or after their death through the sale of that property. As the right on the property gets transferred to the lenders after the death of the original owners, it is advisable to the retirees to consult their children prior to getting involved in this equity release deal in case they expect to inherit the same.