Pensioners ’using equity release’ to pay off their debts

An increasing number of pensioners in the UK are using the equity from their homes to pay off their debts or to improve their quality of life during difficult economic times, new research has warned.

Following a study conducted by the University of Birmingham, the charity Age UK has reported that three quarters of equity release customers are tapping into the value of their property in order to raise money to help clear their debts, and to boost their standard of living in retirement.

Meanwhile, a quarter of those surveyed have used the equity from their home to make early bequests to their family or to make large one-off purchases.

Commenting on the findings, Michelle Mitchell of Age UK said, ’The ageing of our society is a triumph of modern life, yet brings with it some real challenges. Equity release is clearly a useful tool to ease financial pressures in later life, but anyone considering it as an option should first seek good quality information and advice’.

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Date: 08-07-2010