A number of people who wish to convert their assets to cash safely, often use the mortgage system which gives them the opportunity to live in their property even after they’ve withdrawn an amount of equity from it. For example a home owner may decide to sell his home to a financial institution, on condition that they’ll only take the property after the borrower’s death. This system however is only made possible to the elderly, like in the UK one is supposed to be 65 and above to qualify. This scheme is known as a home reversion plan.
Individuals can apply for what is known as equity release if they do not intent to leave the same asset or assets for inheritance. Considering equity release UK gives home owners a number of options for example where one can get a payout for their home but still remain in there till death. This plan is known as lifetime mortgage and can only be given to persons with homes who have little mortgage and have attained a specific age of 55.
There are other options such as drawdown lifetime mortgage palns and interest only lifetime mortgage plans. Another called the Home Income plan is an arrangement between the two parties that the bank facilitating mortgage will provide a certain amount of income every month to the home owner until death, from when they can own the home. (more...)