It might seem odd for an equity release adviser to write this page. It is here because the alternatives get considered properly in every conversation Craig has, so they may as well be written down.
Not everyone referred to Craig goes on to do business with him, and he sees that as a good thing, not a shortfall. His job is not to sell equity release. It is to help you make a well informed decision, which sometimes means being told something else is a better fit, or that nothing is.
Downsizing
Releases capital without any borrowing. Sell, buy something smaller, keep the difference. No interest, no debt, nothing to repay later.
Against it: moving costs money, and the sums often look better on paper than they turn out. Stamp duty, agents, solicitors and removals eat into the gain. There may not be a suitable smaller property in the area you want to stay in, and leaving a home of thirty years is not a financial decision for most people.
Worth considering when the house is genuinely too big, the local market gives you a real gap between selling and buying, and you are ready to move anyway.
A retirement interest only mortgage (RIO)
You pay the interest monthly, so the balance never grows. No end date to worry about. Over a long period it may cost less than letting interest roll up.
Against it: it is assessed on affordability, so your retirement income has to satisfy the lender. Lenders look at income now and in the future, and on a joint application at what the survivor would be left with. Your credit history matters, which it does not for a lifetime mortgage. And because payments are required, your home is at risk of repossession if you do not keep them up.
Worth considering when you have reliable retirement income, want the balance held steady, and can comfortably afford the monthly payment for the long term.
A standard mortgage for older borrowers
Familiar and often cheapest if you qualify. More lenders will lend past 70 than people assume, typically up to around 80 depending on the lender.
Against it: full affordability assessment, capital and interest payments, and a fixed end date the lender will want to see repaid. Home at risk if you miss payments.
Worth considering when you have strong income, want the debt actually cleared, and the term works.
Extending your existing mortgage term
The simplest fix of all, and frequently overlooked. If you are on an interest only deal ending soon, your current lender may extend rather than force the issue.
Against it: entirely at the lender's discretion, and it postpones the problem rather than solving it.
Worth considering when you need time rather than money.
Borrowing from family
No interest, no lender, no product. For families who can do it and want to, it is often the cheapest answer available.
Against it: it changes relationships, and it can become genuinely difficult if circumstances change on either side, if there are siblings involved, or if it was never written down. If you go this way, put it in writing, however awkward that feels.
Worth considering when the family can genuinely afford it and everyone agrees on the terms in advance.
Benefits and grants you may not be claiming
Money you may already be entitled to. A significant number of people are not claiming everything they could, and it is worth checking before borrowing against your home.
There may also be local authority help for adaptations, heating and repairs.
Against it: it takes some legwork, and it may not raise the sum you need.
Worth considering when the amount needed is modest, or as a first step before considering anything else. Age UK and Citizens Advice will both check entitlement for free.
Doing nothing
Genuinely an option, and sometimes the right one.
Against it: if the need is real, doing nothing has a cost too. Going without heating, care or repairs to protect an inheritance is a trade, and not always a good one.
Worth considering when the need is a want rather than a need, or when circumstances are about to change anyway.
And equity release itself
For completeness: no monthly payments required, not assessed on income, no upper age limit, you keep the home, and you can never owe more than it sells for.
Against it: compound interest means the amount owed grows, it reduces what you leave behind, and it can affect entitlement to means-tested benefits.
Worth considering when you need capital, your income will not support borrowing, and you would rather stay where you are than move.
Not sure how any of this applies to your own circumstances? Craig is happy to talk it through, free and with no obligation.
How to actually decide
Not from a website. Including this one.
The right answer depends on your income, your age, your health, the property, what the money is for and what you want to leave behind. Those factors interact, and the combination is what an adviser is for.
Craig looks at the alternatives above as part of the conversation, and will tell you if one of them suits you better than anything he could arrange. There is no charge for that, and our advice fee of a maximum of £1,495 is only payable if a case completes.
Book a call with Craig or call 0113 403 5584.
