Single females take the lead in accessing equity release
Figures reveal that more single females released money from their homes in 2020 than their male counterparts.
The difference in the groups of singles is startling with over 34% more women accessing tax-free cash than men.
The data also reveals that women are accessing an average of £57,243.60, compared to the male average tax-free sum of £61,873.67.
Calculate how much money you could release from your home
What is equity release?
- Equity release is an option for homeowners aged 55 and over with a property worth at least £70,000.
- There are two types of equity release, a lifetime mortgage is the most popular, with this option you continue to own 100% of your property and the loan is secured against your home. The other type is a home reversion plan, these account for less than 1% of all equity release plans and involve selling all or part of your home, although you still have the right to live in it for life.
- You don’t have to make any repayments if you don’t wish to, as the initial amount borrowed and the interest that you accrue is repaid when you die or move into long-term care.
- The money that you release is tax-free
- Once you have repaid any outstanding mortgage that you may have, the money that you release can be spent as you wish.
Over 30% of the single females that released money in 2020 chose to spend it on home improvements. For males, their biggest reason for releasing property equity was to repay their existing mortgage, freeing up more disposable income.
During 2020 a growing reason for people releasing equity was to provide a gift to their loved ones, with the gift mainly be used by family members to get a first step onto the property ladder. 12% of the single males that release equity choose to provide a gift, compared to 15% of the single females.
Use Age Partnerships free equity release calculator
The data was compiled by equity release specialist Age Partnership. One of the company’s senior equity release advisers, Andrew Morris explains a bit more about this later life finance option; “I speak to people every day who are interested in releasing some of the money from their home in the form of tax-free cash. The first thing that I need to establish is whether equity release is the right option for them. It’s not right for everyone as it’s a lifelong commitment, but a specialist adviser should be able to check if an alternative solution, such as downsizing or taking out a standard mortgage is more suitable.
“I then search plans from across all of the equity release market to ensure that I’m finding the best plan for my client’s individual needs. There are lots of options available with rates starting as low as 2.40% APR, although the actual rate that you can secure will depend on your individual circumstances. Once we have completed all of the paperwork the tax-free cash can be with my clients in as little as 8 weeks.”
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