Using equity release options to fund your lifestyle in retirement

As the credit crunch takes a hold, pensions fall short, and the cost of food and fuel rising, most people are looking to cut back and tighten the purse strings. Whilst the current situation is a worry to most, there are some solutions out there.

By the age of 55 the majority of homeowners have their money tied up in their home. In the present climate it may be an option to use this money to enjoy your retirement comfortably, or enable you to remain in a much loved home which was the place where you raised your family. If this is the case you may wish to consider the Equity Release Schemes that are available with various lenders.

The most common Equity Release Schemes are lifetime mortgages which offer either an immediate lump sum, a series of smaller lump sums or regular monthly payments which are set against your home. The sum plus the interest which has accrued is repaid when the property is sold when you die or if you go into long term care.

Lorraine Stratton-Webb, Head of Conveyancing at Bury based solicitors Clough & Willis advises, 'before committing to equity release, you must ensure that you research your options and obtain independent financial advice in relation to the type of scheme. There are various schemes on the market, so you need to ensure you find the right solution to suit your lifestyle.'

As well as obtaining appropriate financial advice you will require legal advice on the implications of the documents that you are signing. Before proceeding, you may wish to consider inheritance for your heirs or beneficiaries, how it will affect your state benefits, your obligation to the property in terms of insurance and maintenance and details of repayment, as all Lenders are different.

Clough & Willis is a leading Bury based solicitors. The firm has 3 offices, with the main office located at Manchester Road, Bury.