If you’re thinking about releasing equity from your home in Liverpool, you may have come across two options: a lifetime mortgage and a home reversion plan.
While both fall under the equity release umbrella, they work in very different ways, and in most cases, only one is still commonly used.
What is a lifetime mortgage in Liverpool?
A lifetime mortgage is the most popular type of equity release available. It allows homeowners aged 55 or over to release money from the value of their home, without giving up ownership or needing to move out.
The money you release is tax-free and can usually be taken as a lump sum, in smaller amounts over time, or a combination of both. Interest is charged on the amount you borrow, but you don’t have to make monthly repayments unless you choose to. Instead, the loan is repaid when your home is sold, typically when you pass away or move into long-term care.
You still own your home and remain responsible for it, which gives you more control than other equity release options. Lifetime mortgages also come with features like inheritance protection, downsizing options, and fixed interest rates.
What is a home reversion plan in Liverpool?
A home reversion plan is a much less common form of equity release. With this type of plan, you sell part or all of your home to a reversion provider in exchange for a lump sum or regular payments. In return, you receive the right to stay in your home for the rest of your life, rent-free.
While you continue to live in the property, you no longer fully own it. The provider becomes a co-owner or full owner, depending on how much of the property you sell. When the property is eventually sold, the provider takes their share based on the percentage they bought , which often ends up being far greater than the original cash amount given.
Very few providers offer home reversion plans today, and they are rarely recommended. The money you receive upfront is usually far below the current market value of the share you sell. In most cases, a lifetime mortgage offers more flexibility and better long-term value.
How does a lifetime mortgage compare to home reversion?
While both options let you access money from your home in retirement, the way they work is very different, and so are the outcomes. A lifetime mortgage in Liverpool allows you to release equity while keeping full ownership of your home. With a home reversion plan, you give up a portion or all of your ownership in exchange for a lower lump sum.
One of the main reasons people choose a lifetime mortgage is flexibility. You can decide whether to make repayments or let the interest roll up. You also keep the right to stay in your home and benefit from any future increase in its value. Home reversion plans, on the other hand, usually involve selling your share of the property at well below its current market value.
Lifetime mortgages also come with features such as fixed interest rates, inheritance protection, and downsizing options, giving you more control over your property and your future plans.
For most people, taking out a lifetime mortgage is the more practical and flexible choice. While both are part of the equity release market, the structure, availability, and long-term value of lifetime mortgages make them the preferred option.
Is a lifetime mortgage right for everyone?
Taking out a lifetime mortgage in Liverpool can be a helpful way to release equity in retirement, but it won’t suit every homeowner. Like any financial product, it depends on your personal circumstances and long-term plans.
If you’re looking to stay in your home for the rest of your life and want to access funds without making monthly repayments, a lifetime mortgage could be a good fit. It may also appeal if you’re not concerned about leaving the full value of your property as inheritance.
On the other hand, if you’re planning to move in the near future, or if keeping the property in your estate is a priority, it’s worth considering how a lifetime mortgage would affect that. While some plans offer features like downsizing protection or inheritance safeguards, they may not be suitable for everyone.
Mortgage Advice For Older Borrowers in Liverpool
If you’re thinking about releasing equity from your home, it’s important to understand how each option works. While lifetime mortgages are the most popular and widely available choice, it’s still helpful to know how they compare with home reversion plans.
As a mortgage broker in Liverpool, we’re here to talk through your options and help you find the right path for your circumstances. Whether you’re just starting to explore equity release in Liverpool or ready to take the next step, our team is here to support you.
Date Last Edited: June 6, 2025
