Home Reversion Plans Questions
A Home Reversion Plans involves selling part (or all) of your property to a specialist Equity Release company in return for a lump sum, or regular payments (an income).
How Old Do You Need To Be To Take Out a Home Reversion Plan?
You will need to be over the age of 65 to be considered for a Home Reversion Plan.
What Happens After You’ve Arranged a Home Reversion Plan?
One of the features of a Home Reversion plan is that you will still have the right to live in your home after you have sold it. The terms of your tenancy will be either on a rent free lease, or a minimal charge, and it will be for the rest of your life or until you leave to move – most likely, when you go into care.
What Happens When You Leaven Your Home or Die?
If you move out of your house or die, the Home Reversion Plan will be repaid. If this occurs soon after arranging you Plan, it is likely that the scheme could prove to have been an expensive way of releasing equity.
However, there is a high degree of certainty with Home Reversion Plans about the amount of money that will be taken from your estate in the event of leaving your house, or death, because you know exactly how much has been taken.
What Happens If You Want To Move Home?
Many Home Reversion Plan providers enable you to move home if you want to but this will be subject to the agreement of the provider: you will be unlikely to be able to move to a home that they may find difficult to sell, eg sheltered housing.
What Upkeep Do You Need To Make?
You will need to continue to insure your property, and ensure it is properly maintained whilst you live there.
How Much Will You Receive From A Home Reversion Plan?
The amount you will receive will depend on a number of factors including:
- Your age
- Your state of health
- The value of your property
You are likely to receive between 24% and 65% of the value of your house depending on your age (or a combination of the ages if the Home Reversion Plan is taken out with your spouse or partner). This is substantially less than the actual market value and the reasons for this are:
- You will not be paying any rent whilst you’re staying at your home
- The Equity Release company that has provided the money to you through the Home Reversion Plan may have to wait many years before it can sell your property and realise its investment.