- Equity release may look like an attractive option for older individuals looking to raise funds, but it comes with complexities
- We look at recent market developments, what equity release does and what to consider
- The risks and alternatives, warrant a good deal of consideration
The devastating impact of the coronavirus crisis will mean that even older, wealthier individuals may now be seeking to fill a hole in their finances. Dividend income has collapsed, as have bond yields and the rates on many savings products. Some individuals have suffered capital losses amid the market volatility of 2020, while others may wish to help relatives in dire financial straits as mass redundancies kick in.
Homeowners aged 55 or older who have paid off their mortgages may now be considering equity release as a new source of finance. The entrance of household names such as Legal & General, Aviva and Nationwide Building Society into the space has drawn greater attention to this industry, while the doubling of membership of the Equity Release Council in the two years to January 2020, and the number of TV adverts promoting their products tells us something about the lucrative nature of this market.