An equity release mortgage is sometimes referred to as a reverse mortgage in the United States. But regardless of what it’s called, it is a particularly useful scheme that will allow an individual to gain a lump sum whilst retaining their house. However, you will be expected to pay back the loan when you die, and so some of your assets may be sold in order to cover these costs. This way of gaining money is often recommended for elderly people who don’t have heirs, or may not wish their heirs to inherit any of their property after they die. This is the most basic form of equity release mortgage, but there are a number of additional types that need to be listed.

• A lifetime mortgage: The idea that a loan is secured in the borrower’s name. Interest is added and is then paid off when the person dies or perhaps moves into a care home. Before this happens the borrower still remains the legal home owner.
• A home reversion: This is the idea that an individual or couple sell their home to a company or a third party. They then continue to live in this home, but will receive a regular income. The borrowers/sellers can then live in this home for as long as they desire.
• Interest only: A mortgage is made and subsequently money is borrowed which will be repaid at the time of death. Interest payments are paid on a regular basis.

These are the main types of equity release deals that are currently available on the market. Most of these deals allow you to gain regular payments or a lump sum of money without having to pay interest. This could increase you quality of life drastically, but you will only really be considered for an equity release once you are over a certain age. In addition to this it is advisable to be fully aware of all the terms and conditions, as in most cases it will mean that heirs will receive very little as the property in question may be sold in order to pay back the loan with interest. However, equity release may be seen as a great way of receiving money, and not having to worry about paying it back in your life time. But overall equity release is only really recommended for those people that do not have heirs, or those who are not concerned about leaving an inheritance.