Equity Release – Home Reversion Plans

With a home reversion plan you sell part or all of your home to a reversion plan company in exchange for a tax-free cash lump sum and a guaranteed lifetime lease with no monthly payments to meet.

You stay in your home rent free for as long as you choose and are able to guarantee an inheritance to your beneficiaries. Both you and the reversion scheme company share in any increase in your property’s value, according to the percentages owned.

Advantages of a home reversion plan

• You are able to guarantee an inheritance
• There are no monthly repayments to make
• You benefit from any increase in value of the percentage of the property that you still own
• You can typically raise more money from your home at a younger age with a reversion plan than a lifetime mortgage would allow
• The older you are, the more money you will be able to release with a reversion plan

Disadvantages of a home reversion plan

• Typically, you do not receive the full market value of the share of the property you sell because the reversion plan company will give you the absolute right to live in it rent free for the rest of your life, and will not get their money back for a number of years
• The reversion plan company owns a share of your home and will also benefit from any increase in value
• Reversion plans cannot usually be reversed as you are selling part of your home
• The majority of reversion plan providers do not guarantee further advances

If you are thinking about taking out an equity release plan, you should read through ‘Is it right for you?’ carefully.

This is a home reversion plan. To understand the features and risks ask for a personalised illustration.