If you are over 55 and own a second home or a holiday home in the UK that you primarily use for yourself, we can help advise you on the best scheme for you.

Only a few lenders offer equity release for holiday homes, as they are left empty for longer durations. Equity Release 4 You has helped various customers acquire a scheme on second homes, and holiday homes, across the UK. While doing so, we have gained knowledge, and have also built up a database of trustworthy lenders – so you know that we can offer the best possible advice.

Depending on some of the following factors, we can offer independent advice on gaining a lump sum from your second home.

If you:

• Own a second home within the UK
• Know the value of your property
• Own a home that is the correct type of development (we, unfortunately, can’t help with log lodges, park homes or static caravans)

Then ER4U can help.

HOW MUCH EQUITY WILL YOU BE ABLE TO RELEASE ON A HOLIDAY HOME?

Each deal is independently evaluated and the sum you will most likely obtain is only marginally less than if the property was your sole residence. You can find out a rough guide of how much you could borrow with our calculator, or call one of our team on 0800 180 4883 for an informal, no-obligation chat about the value of your second or holiday home. 

Equity Release on Homes

While most equity release providers allow you to take out equity against your main residence, Equity Release 4 You lets you release funds against your second or holiday residence as well. If you are a UK resident and own a second property in the UK, there is no reason why you cannot avail the benefits of equity release on second home. Being an equity release specialist, we allow you to access a variety of equity release on home plans across the whole market.

What is a Second or Holiday Home Equity Release?

Equity release for second home refers to a range of lending products that allow you to release equity from your additional homes. As the holiday or second home plans are special plans on equity release on homes, the choice of providers is very limited. Fortunately, Equity Release 4 You in London is proud to offer multiple equity release home plans that suit your requirements.

Since you want to take out equity on the second home, it is must for you to ensure that your property is being used by or your family members for at least four weeks in a year. This is for the assurance that the home you own is not a buy to let property. However, we may allow you to release funds against your buy to let property under strict conditions.

Similar to equity release on home, the amount you can borrow will be dependent on the value of your property, your age and your state of health. The repayment of the mortgage is required to be done when you pass away or move to long-term care. There is no need to make any monthly repayments unless you want to.  

Generally, borrowers are allowed to take out a lump sum, drawdown, interest only and voluntary repayment equity release plans on their homes. Hence, we suggest that you contact our equity release for home improvements specialists who will explain all the terms associated with it and provide information on how to release equity from your home.

Lump-Sum Second Home Mortgage (Lifetime Mortgage)

With the lifetime mortgage scheme, you will be provided with a one-time lump sum of cash. This plan is ideal when you want a big amount of money for a particular purpose. This plan is specifically chosen for equity release home improvements or helping your children pay a deposit for their new home.  The interest amount will roll up every month and will be added to the capital. At the end of the term, the total loan amount and the accrued interest will be paid off when you die or shift to permanent care.

Drawdown Second Home Mortgage

The drawdown mortgage allows you to take out an initial fund from the total equity release on your home. The rest of the amount is stored in the cash reserve facility for future use, which you can withdraw whenever and as many times as you want in the future. There are no withdrawal charges and the interest is charged only on the amount you withdraw. You don’t have to pay interest for the amount that is reserved in the facility. This could save you thousands of pounds if you don’t require a large sum of money initially.

Interest only Second Home Mortgage

The interest only equity release on home is a type of lifetime mortgage, but with one key difference –  you will be required to make monthly interest repayments. The amount you borrow is repaid when you die and your property is sold. This prevents the interest from building up every month, which may increase your final payable amount. Since you pay interest monthly, you only have to pay the amount you have withdrawn.

Voluntary Repayment Plan

The voluntary repayment plan works similar to the lump sum and drawdown equity release home plans but provides additional flexibility for repayments. When you take out equity, you are allowed to make voluntary repayments of the interest or the equity amount. Under the voluntary repayment plan, you can choose the interest only plan where you are needed to pay only monthly interest, full 10% of the initial amount every year or random payments whenever you want. This will reduce the amount of interest payable at the end of the loan.

What are the Advantages of Equity Release on My Home?

Enable you to borrow against your second property

Getting an equity release on your home is not restricted to one property. You can use multiple plans against multiple homes subject to eligibility. The amount you release on the second home can often be used in securing equity release on home. However, the money is tax-free, which means you can use it the way you like.

There are no fixed monthly repayments

The total loan amount and the accrued interest are usually paid back when you pass away or move to long-term care. Nevertheless, if you wish to make monthly repayments, it is completely your choice.

Release money as a one time sum or in smaller chunks

Whether you want to use equity release to buy a second home all at once or help your children financially by withdrawing smaller amounts over time, the choice is all yours.

‘No negative equity’ guarantee

‘No negative equity’ guarantee ensures you will never have to pay more than the value of your second home. This gives you complete peace of mind that there will be no burden on your family.

How Much Equity Can I Release Equity From My Home?

The requirements of the standard equity release home and equity release second home plans are nearly the same. The only additional condition is that you should use your holiday or second home for at least four weeks in a year. Thereafter, based on your age and the property value, you can release equity on your second home. We advise you to use our free equity release calculator to get an estimate of much you can release.

Thus, if you have a second or holiday home and would like to know more about how to release equity in your home, feel free to speak with one of our financial advisers and they will guide you in choosing the right equity products based on your situation.

Please contact us today to find out more.