Martin Lewis is a renowned British financial journalist and consumer champion. He is the founder of the Moneysaving Expert website and is widely respected for his independent and impartial advice.
Lewis has spoken extensively about equity release, a type of loan that allows homeowners to access the equity tied up in their property. He has stated that equity release can be a useful financial tool for some people, but it is important to consider the potential risks and drawbacks before taking out a loan.
Lewis’s key points about equity release:
- Equity release can be a good way to access money to help you live a better retirement.
- Equity release is not a decision to be taken lightly, and it is important to seek professional advice before proceeding.
- Equity release can have a significant impact on your inheritance.
- Equity release is not suitable for everyone, and it is important to consider your individual circumstances.
Here is a more detailed look at Lewis’s views on equity release:
- Equity release can be a good option for homeowners who are asset-rich but cash-poor. This means that they have a lot of equity in their home, but they are struggling to make ends meet. Equity release can allow them to access this equity and use it to improve their quality of life.
- Equity release can be a good way to pay off debts or fund other large expenses. For example, some people use equity release to pay for home repairs, long-term care, or to help their children with a deposit on a house.
- Equity release can be a good way to supplement your income in retirement. If your pension is not enough to cover your living costs, equity release can provide you with a lump sum or a regular income stream.
Equity release is not suitable for everyone. It is important to consider the following risks and drawbacks before taking out a loan:
- Equity release can reduce the amount of inheritance you leave behind. This is because the loan is repaid from the sale of your property when you die or move into long-term care.
- Equity release can be an expensive way to borrow money. Interest rates on equity release loans are typically higher than standard mortgage rates.
- Equity release can have a negative impact on your credit score.
Lewis’s overall advice on equity release is that it can be a useful financial tool, but it is important to consider the potential risks and drawbacks before taking out a loan. He recommends that people seek professional advice from an independent financial advisor before proceeding.