Can I release equity out of my house to pay debts without the monthly payment going up?
Releasing equity is a fancy phrase for borrowing money against the value of your house. Some plans aimed at older people don’t require any repayments until after death, when the house would be sold to pay off the loan and any accumulated interest. But generally you “release equity” by taking out a mortgage. In this context equity means the value of your house, less any debts (existing mortgages etc) currently secured on it. So if your house is worth £200,000 and you owe £100,000 on your current mortgage then you have equity of £100,000. You may be able to extend your current mortgage, or you may be able to get a second mortgage. If you borrow more money, then you will have to pay more back. Either your payments must go up, or you will have to continue making payments for longer, or a combination of both. And for the same debt, the longer you take to pay it off, the more interest will be charged, so the more you will pay in total. You need to talk to a financial adviser to get an accura
