A reversion plan is essentially where you sell a portion or the entirety of your home to a reversion company in exchange for either a lump sum , monthly income or both. You can use the money to fix up your home, take a vacation, buy a new car, or even just to have as extra monthly income if you so desire.
Please note however, if you have an existing mortgage on your property, this will need to be less than the equity release available through the home reversion plan, as it is a requirement that any existing mortgage will need to be repaid as part of the home reversion scheme.
Lifetime mortgages have long been in the spotlight when it comes to equity release plans. However, home reversion is becoming much more popular due to the various advantages that it has over a lifetime mortgage. Here are some insights as to why these plans can be effective.
- A home reversion plan allows you to get either a lump sum payment or a monthly income from the sale of either a portion or your entire home, and can be an expedient way to raise funds when retirement income is limited.
- Finding a home reversion plan provider is easy. Through our partnership with Key Retirement Solutions, you have access to a FREE equity release consultation, where you can receive advice on the different equity release schemes and home reversion plans. Receiving good impartial advice, will give you all the information you need about all the equity release choices available, so that you can make an educated and informed decision.
- Home reversion plans can help avoid inheritance tax. If you sell off a big enough portion of your home, your family can then inherit an amount that is below the inheritance tax threshold. That will save them having to pay a percentage of the home’s value as inheritance tax. However, you cannot determine what the market or the tax regulations will be in the future and so you should always seek independent legal and taxation advice before entering into any form of home reversion or lifetime mortgage scheme for the purpose of inheritance tax mitigation.
- Home reversion allows you to get the cash that you need for a variety of situations. You can use the money to fix up your home, take a holiday, buy a new car, or even just as an extra source of income so that you can enjoy your retirement more than you would have otherwise. There are no stipulations like there are with many other financial loans. You can use the money for whatever you want, no matter what that might be.
- Home reversion plans allow you to choose how much of your home you wish to sell. Through discussion with your adviser, you can determine the amounts that can be release by the different reversion companies based on the value of your property.
When you’re considering something as serious as home reversion plans, you need to make sure that you are properly informed and educated about the home reversion plans available, and whether they are more appropriate for your circumstances and requirements in comparison to other equity release choices such as a Lifetime Mortgage or Equity Release Scheme.
The best way to ensure you have all the information you need about the different home reversion plans available, is to