Drawdown schemes are actually the most popular way to release equity in property. This is because the low interest rates at the moment, make it a very attractive proposal. It is currently a very competitive part of the market and so low costs and good interest rates are likely to be found at the moment.

They work by allowing you to release some equity form your home and then take the money in stages. So you do not get a large lump sum, but you get a series of smaller amounts of money. It works by releasing all of the money but holding most in a reserve. Then it is available for the home owner to have when they want it.

The advantage of doing this over taking one larger lump sum is the interest. You will pay interest only on the sum that you have taken from the reserve. So it is likely that there will be a lower interest costs over the term of the loan. It could also mean that there will be inheritance left.

Another popular feature is that you can make withdrawals whenever you like. It means that if you have a sudden need for money, you can request it, rather than struggling or having to wait a while to acquire the money. It is almost like having a savings account with money that you can draw on.

It is possible that you may lose benefits if you release equity in your home. However, if you only draw smaller sums of money, these may not effect your benefits as they are often determined by how much money you have saved and so if you stay below this level, you will not lose this money.

There are some disadvantages to the scheme though. You may not be able to withdraw a large amount of money initially, so you may not gt as much as you need. Sometimes the reserve facility is not guaranteed and the lender might draw on it. Later withdrawals could be at a higher interest rate than earlier ones which could make it expensive and the you may be restricted on how big your reserve facility can be.

Like all financial products you will need to check all of the terms and conditions and use a lender that you trust to ensure that you get the best possible service and deal for you.