Among over-55s, when asked key questions about equity release, only 11% answered all correctly, while 89% got at least one answer wrong, according to research by SunLife.
When presented with the statement that they would still be able to move house when accessing equity release, the majority answered either ‘do not know’ (42%) or ‘false’ (10%), when the correct answer is ‘true’.
The statement that children would have to repay the loan, only 49% answered ‘false’ correctly.
In answer to the statement that it is not possible to release equity if you have a mortgage, 49% did not know, while 16% incorrectly answered ‘true’.
However, 61% were aware that it is false that equity release borrowers risk losing their home, while 95% knew that they would be able to stay in their home, and 76% that they would still be able to leave an inheritance.
Simon Stanney (pictured), equity release director at SunLife, said: “Equity release can offer a solution for many over-55 homeowners looking for a boost to their finances, but it is not for everyone.
“Getting advice is a necessity and it is also important to talk things over with family and loved ones because taking out equity release is likely to affect them too by reducing their inheritance.”