Equity release

Equity release means taking part of the value of your home in cash from a company and giving them a mortgage over your home to secure the debt. Not selling it. You can either pay interest on the amount released or let the money released plus interest build up, which can lead to a very large debt over just a few years as the interest is charged not just on the sum released but also the outstanding interest each. The debt would be repaid when you die, your home is sold or if you go into a care home.

However, unless you want carry on living in your home but need some cash, equity release may not be the way to go. It seems that you want to avoid leaving anything to disabled relatives who rely on State help. Maybe these relatives would inherit your estate if you died without leaving a valid will. You can however make a will leaving your house and money to whoever you wish. If you would like to see these relatives looked after without losing help from the State you could make a will which creates what is called a discretionary trust whereby they are not left money or entitled to money but are entitled to request money or help, for instance with buying aids such as wheelchairs, from the trustees. That would avoid depleting your estate by taking out equity release if you don’t need to. A solicitor specialising in wills and trusts would advise you.

Very informative. Thank you.

or you could just make a will and leave all your money to someone else entirely, friend, relative, charity.

Lilyofthevalley I have been rereading you OP and I am wondering whether you are in the UK or not because I deduce from your post that the disabled relations you refer to are learning disabled and receive social care and help, as well as financial help and you are worried that if they no longer qualified for ssickness benefit or similar that all social support and help would be withdrawn as well.

But that is not the case. Someone who is learning disabled, whether they are financially independent or not, can still be the responsibility of social services if they are no capablle of managing their own lives or not.

GSM is right to suggest that you speak to a solicitor, but if that is an expense you cannot afford you could go and speak to Citizens Advice or even Age UK. You can find out where your local CA or Age UK office is by googling it online or asking in your local library.

LilyoftheValley, if you want or need the money released, then it's something to consider - and carefully research - as there are many different options.

If, however, it's just to avoid inheritance and they are your only relatives, think about leaving your estate to a charity.