Who Owns The Property After Taking A Release Of Equity?
This will depend on what type of equity release scheme has been taken. For a lifetime mortgage, the homeowner will retain 100% of the ownership of the property as the plan charges interest like any conventional mortgage would. This would be for the complete duration of the plans term.
However, a home reversion scheme works differently. When a partial or full sale of the property is made to the home reversion company, you give up a percentage ownership of the property. This could mean the complete sale of the property which would result in the home reversion company owning 100% of the dwelling. Nevertheless, you would still retain the right to continue living there for the rest of your life due to a lifetime tenancy agreement being created between both parties.
However, upon death or the last person moving into long term care the ownership of the property must be changed. For a lifetime mortgage, most lenders will grant a 12 month window before which time the equity release loan must be repaid. The beneficiaries can at that point either sell the property to repay the equity release company, or repay the loan using their own funds, resulting in them taking full ownership of the property.
