Can I Use Equity Release To Buy A New Home?
Whether you are looking to purchase a new home to move into or purchase a property for a family member, we can explore your equity release options to see if it’s affordable for you.
What mortgage type will be best for you to release equity to buy another house will depend on how much income you have, what you are looking to do with the new home, your credit score, how much equity you have, how much equity you are looking to release, and the purchase price of the new property.
There are two options:
Remortgage to release equity via a standard remortgage, available on repayment or interest-only terms.
Lifetime mortgage — an equity release plan designed for those over 55.
We are going to focus on option 2 in this article. For various reasons, many of our later-life customers look to release equity to buy another house. These are mainly:
Moving to a new, more expensive home.
Buying a property for a family member, adult child, or grandchild to live in and enjoy.
Purchasing a holiday home.
Divorce or separation arrangements.
How much equity you can release from your house will depend on several factors. These may include your age or your partner’s age if it’s a joint application, your property’s value and construction, plus your health and lifestyle and your credit history.
If you are a buy-to-let investor looking to expand your portfolio, you’ll need a buy-to-let mortgage, or if you’re looking to rent your current home to buy a new one, this is called a let-to-buy mortgage transaction.
Our trusted third-party later-life lending adviser will listen to your requirements and recommend the best way forward. Traditional and RIO mortgages should be considered and discounted before an equity release plan is recommended due to the costs involved.
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