Equity Release Home Reversion Plans

Home Reversion Plans is the act of selling all or a share of your home but continue to have the right to live in it for the rest of your life.

Calculations for Home reversion plans are dependent on your circumstances: Your Age, The value of your property, percentage of the property you wish to surrender and the rate offered by the provider.

If you which to release 20% of the value of your property, this can cost you from 60% to 75% of the value of your home. Plans are always calculated as percentage so if the property value increases the provider will receive the same share, but a higher value.

 

  • You must be at least 65 years old
  • The lump-sum is tax-free
  • No monthly payments (some providers charge a nominal rent of £12 per year)
  • You can sell all or a percentage of your home

This website refers to home reversion plans and lifetime mortgages. To understand the features and risks, please ask for a personalised illustration.

Example: (Lump Sum)

The following examples are taken from www.which.co.uk who looked at the three main providers to take out a home reversion loan. This comparison was completed in February 2013

Provider A Provider B Provider C
Value of property £250,000 £250,000 £250,000
Age of youngest owner 65 65 65
Value to sell (20%) £50,000 (20%) £50,000 (20%) £50,000
Provider share of the property offered (72.3%) £180,750 (73.8%) £184,500 (59%) £147,500
Owners share (27.7%) £69,250 (26.2%) £65,500 (41%) £102,500

If the value of the property increases 1.5% each year for 20 years

New Value of property £336,714 £336,714 £336,714
Provider share of the property (72.3%) £243,444 (73.8%) £248,495 (59%) £198,661
Owners share (27.7%) £93,270 (26.2%) £88,219 (41%) £138,053

Home Reversion Providers

There are 4 main providers in the UK that provide Home Reversion plans:

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