Home Reversion Plan

A home reversion plan is designed for home owners who wish to release the maximum amount of equity within their property. Unlike equity release lifetime mortgage schemes where you retain full ownership of your property using a home reversion plan you sell some or all of your property to the plan provider. 

Key Features of home reversion plans

A home reversion plan allow homeowners to release a lump sum from their property, without concerns over future house prices, or the effect of roll up interest.

The amount of equity you can release under a home reversion plan will depend upon your age, and the value of your property.

With a home reversion plan, also known as home income plans, you sell all or part of your property to the plan provider. As you sell your property in exchange for the equity released the plan provider takes the risk on future house prices. 

If you sell 30% of your property to the home reversion plan provider, known as a partial reversion, the plan provider will be entitled to 30% of the sale price when your property is eventually sold.

If you sell 100% of your property to the home reversion plan provider, known as a full reversion, the plan provider will be entitled to 100% of the sale price when your property is eventually sold. 

Note you will not receive the actual cash equivalent lump sum as the percentage of the property sold to the home reversion plan provider. The actual cash value offered will be subject to the discount factors applied by each individual home reversion plan provider.

If you sell all of your property to a home reversion plan provider under a full reversion plan you will become a lifetime tenant in your home. You will not be charged any rent but you will be responsible for maintaining the property and any repairs. 

A home reversion plan normally offer's a choice of a tax free lump sum or a guaranteed regular monthly income. 

Home reversion plans are available from age 65 and normally require a minimum property value of £40,000. Most home reversion plan providers do not impose an upper age limit, and will release a greater percentage of the value of the house for older applicants. 

Subject to the individual terms of the home reversion plan providers you may be able to move properties in the future. There are different terms applied to partial reversions and full reversions.

All providers who offer a home reversion plan and are members of the safe home income plan scheme provide guaranteed tenure and a no negative equity guarantee. This guarantees that you will always have guaranteed rent free tenure of your home until you die regardless of the future value of your house.   

Review which providers offer a home reversion plan under the Safe Home Income Plan guarantee.

Using a home reversion plan means you will only be responsible for your home contents insurance as the plan provider will normally be responsible for the buildings insurance. 

Review our equity release service charter only available from our panel of independent equity release specialists.

Other Useful Sites You Can Try For Equity Release Schemes

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