Equity release 'should be a last resort'

22/09/2008

Many equity release products do not offer good value for money, consumer group Which? has claimed.

In a new report, the organisation claims that borrowers are often stuck with expensive and inflexible loans, which drastically sap the value stored up in their homes.

Equity release works through a homeowner taking out a loan against their own property - and not having to repay until they either sell up or on their death.

Philip Spiers, the report's co-author, commented: "Equity release might seem like the solution for any pensioners struggling to make ends meet this winter.

"If your circumstances change you might not have enough money remaining to fund alternative accommodation, and money received through equity release may seriously alter the amount of benefits you are able to collect."

He added: "Anyone considering equity release should do so cautiously - and only after exhausting other options."

Tags; Debt Management and Banking, Retirement Money Problems,

• Share
• 
• 
• Store
• 
• Follow
•