As time progresses and as in the current housing climate, property values continue to rise, equity on a property can be incurred. Equity is the excess of the market value of a property over the original mortgage amount.

There are a number of ways to release equity in a property in order to free excess value to be used for another purpose. These methods are remortgaging, second mortgage, home equity release schemes, used to enable asset realisation.

The process of re-mortgaging can be utilised to achieve different objectives. Persons may look to re-mortgage purely to reduce their current monthly mortgage payments, after the redemption penalty of the previous mortgage has been forgone.

A remortgage can be done in order to increase their original mortgage. Clients may want to realise some of the value of their property to fund other aspirations. They may even wish to consolidate their debts into their mortgage to reduce monthly outgoings and repay the debts, therefore having reduced expenses and liabilities, opening the door to other financial opportunities.

A second mortgage is an additional loan from a different lender and is secured as a second charge on the property. This leads to generally higher rates on the second mortgage, but lower than that of an unsecured loan.

Equity release schemes are generally used by older people who do not have an outstanding mortgage. They are owners of large capital assets, whereas what they need is an increase in their income. The equity release schemes allow persons to convert their capital assets into a lifetime income.

*this product is not regulated by the Financial Services Authority. Loans subject to age, status and quotation. Insurance may be required. Written quotations available on request. YOUR HOME IS AT RISK IF YOU DO NOT KEEP UP PAYMENTS ON A MORTGAGE OR OTHER LOAN SECURED ON IT.