Equity release mortgages set to grow in popularity

Wednesday, 02 January 2008 12:00

Rising numbers of people opting for equity release mortgages have underlined the importance of gaining professional guidance before making the move.

New research by Newcastle Building Society equity release service revealed nearly one in four people would not know where to get advice on releasing equity from their home.

However, the survey of 3,480 people, revealed despite this a huge 45 per cent still considered it a viable option for them.

Now Newcastle is urging anyone considering equity release to get proper guidance before implementing their plans.

Bob Mottershead of Newcastle Building Society's equity release service, said it was "concerning" to see so many people had no idea where to get guidance.

He added: "Equity release isn't right for everyone so our advice is to speak to a regulated consultant."

Although only two per cent of those questioned had an equity release plan in place, the building society said, with consumer confidence growing, this was likely to rise dramatically.

Mr Mottershead said: "Equity release has been subject to a lot of bad press, but almost half of people seeing it as a possibility indicates it is becoming a mainstream option.

"It is clear that the work that has been done to regulate and re-educate on equity release is beginning to bear fruit.

"Add to this falling interest rates on equity release products and flexible options and the market is certainly set to grow."

Newcastle said equity release was becoming a more popular way of meeting routine living costs in later years and most people surveyed said they would use the money to improve the quality of their everyday life.

Holidays, home improvements, reducing inheritance tax bills and paying off other bills and debts were also cited as reasons for releasing equity from homes.

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