A home reversion plan, a type of equity release plan, provides an excellent opportunity for established homeowners who are age 60 or older to obtain some cash in exchange for some equity in their home. In essence, it involves selling a portion of the home's equity to a reversion company or provider in exchange for a sum of money.

You decide how much money you want to get. The homeowner can elect to sell all of their property or just a portion of it to the reversion provider. In exchange, he receives a sum of money. He can take the money all at once or opt to receive it in monthly installments. Plus, the homeowner can remain in the home for the remainder of his life without paying rent.

No interest is charged on the money since it is not a loan. This means that you do not have to make any monthly payments at all in order to repay the money. The reversion provider now owns part of your property and he will eventually get his financial investment back.

In fact, the homeowner does not need to repay the money until he moves into a long-term care facility. In the event that the homeowner dies, the money is repaid to the reversion provider. If a second or joint homeowner is involved, the circumstances apply to that individual as well. This means that both individuals would need to be in a long-term care facility or deceased before the money is due.