Can you Get Equity Release on a Park Home?
Equity release can allow us to release money stored within our homes. However, each equity release lender has different rulings. One of the most common questions is which type of property can you release equity on. Can you get equity release on a park home?
You can’t get equity release on a park home, this is because they are classed as mobile homes and not a freehold or leasehold property type.
The two types of equity release schemes are lifetime mortgage and home reversion, park homes do not meet the eligibility criteria for either.
Park homes are a type of caravan, they are not built on a permanent foundation so they cannot be classed as property.
If you are a park homeowner and are looking to release equity from your home, your options are limited. You may be able to borrow money through the government’s home adaptation scheme, but this is only available for certain adaptations. You could sider alternatives such, or sell your park home and downsize to a more suitable second property using equity release.
What is a park home?
A park home is a type of caravan that is permanently located in a park. The park owner will own the land and the caravan owner will actually own the caravan. The price difference between park homes and mobile home is much lower than traditional bricks and mortar – one can buy them for less than £100,000 in most parts of the UK. The UK has approximately 180,000 park property owners, with most of these owners living in private park homes. Many older couples use equity release to purchase a holiday home abroad like this.
Alternatives to equity release
Can you get equity release on a residential park home?
While you won’t be able to get equity release on a park home, there are several other forms of financial assistance available to retired people living in mobile homes, so be sure to review all your options before selling.
Can you be refused equity release?
Equity release may be refused. Although there are different types of equity release, certain criteria is needed to make your application appealing to potential lenders.
Can you get equity release on a wooden house?
Even if you are able to obtain equity release on non-standard constructions, each lender will have its own strict criteria for different types of construction, such as: Timber-framed houses, thatched roof tiles or steel frames houses.
Can you get a mortgage on a park home?
You will not be able to get a traditional mortgage for a park home. In addition, mortgage lenders are put off by the fact that park homes are situated on private land and tend to depreciate over time.
Need advice on equity release?
If you are considering equity release, make sure to seek professional advice first. An adviser will be able to give you personalised recommendations, based on your individual circumstances.
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