Can equity release help with ever-increasing mortgage repayment costs?

23rd June 2023

Yesterday’s news, 22 June 2023, by the Bank of England raising interest rates to 5% signified the 13th consecutive rise, placing homeowners on variable mortgages under the weight of increased monthly mortgage payments. We have experienced an increase in enquiries from concerned individuals who are troubled by the escalating costs of their base rate tracker mortgages, with financial anxieties reaching a new peak. Fortunately, there might be a solution: equity release. With the potential benefits of equity release offering the possibility of replacing existing mortgages, along with the added flexibility to choose whether to continue making no or ad hoc monthly payments, this is a question which needs some discussion.

Understanding the impact of rising interest rates

With each successive rise in interest rates, homeowners face mounting financial challenges, especially those with fixed incomes or those coming to the end of their interest-only mortgage terms. These escalating monthly mortgage payments leave little room for discretionary spending, leaving a significant threat to the financial stability of those who are already retired or approaching retirement.

Exploring equity release

Equity release presents a way for homeowners to access their home’s equity without selling it. By leveraging age and property value, individuals can secure a lump sum of cash through an equity release plan. Typically, repayment is due with the property is sold or the homeowner passes away or goes into long-term care.

The benefits for the over 55s

If you are aged 55 or above and struggling with increasing monthly mortgage payments, equity release may offer a welcome relief. By replacing their existing mortgage with an equity release scheme, they gain flexibility to decide whether to make monthly repayments and at what level. The popular lifetime mortgage option eliminates the need for income and affordability checks, providing the freedom to make voluntary repayments of up to 10% per year.

Addressing financial challenges in retirement

Equity release proves especially advantageous for those who have retired, living on fixed incomes and burdened by outstanding mortgages. However, it is crucial to note that any existing mortgage must be repaid before or upon completion of the equity release plan but this can be done through the conveyancing process with your chosen solicitor. Conducting thorough research and comparing available options are essential steps to securing the most favourable outcome. Accessible resources offer accurate rates and tailored amounts based on individual circumstances.

Seeking professional advice

Given the strict regulations surrounding equity release by the Financial Conduct Authority (FCA), seeking professional advice is fundamental. Kevin Woods will provide invaluable guidance throughout the process, and will discuss all options available to you, ensuring well-informed decision that align with your individual needs. Kevin will only ever recommend equity release if it is the best option for you and your circumstances.

Considering risks and benefits

As with any financial decision, it is essential that you carefully consider the risks and benefits. Kevin will provide a comprehensive understanding, in clear and simple language of the personalised risks and features associated with equity release.

Take control of your finances

Don’t let the latest rise in interest rates weigh you down. Explore the potential benefits of equity release and the possible relief from increasing mortgage payments. Equity release may indeed offer you the opportunity to feel that you can regain control of your financial future amidst these times of financial uncertainty in the current climate.

If you would like to take the first steps towards a greater sense of financial freedom, contact Kevin on 01489 454545, or email for a free consultation without commitment of any kind.

Why not get in touch and see how we can help?

Equity release could be the answer to some of your financial questions. If you would like to know more about it, and see if it could be the right option for you, please book an appointment or request a call-back

Providers include

Pure Retirement

Equity release will reduce the value of your estate and may also affect your entitlement to means-tested benefits. You should always think carefully before securing a loan against your home.

Unless you decide to go ahead with a plan, our service is completely free of charge, as our fixed advice fee of £1,695 is only payable on completion of a plan.

A lifetime mortgage is the most popular form of equity release, and is a loan secured against your home that’s typically repaid when you pass away or go into long-term care.