An article which appeared in this column last April about releasing equity in the family home for income purposes continues to generate interest from readers. The story concerned a new lending product called the Share Appreciation Mortgage which was introduced by the British-based, Bank of Scotland.

The product works by offering mainly elderly people who own their homes outright a mortgage based on a zero per cent interest rate. The loan is limited to just 25 per cent of the value of the house. No repayments whatsoever are made, but when the owner dies, or the house is finally sold (if the owner goes into sheltered accommodation), three times the loan percentage is taken from the growth in the property's value and the loan itself is repaid from the capital realised by the sale.

For example, if the property was to increase in value, say by 20 per cent between the time of the loan and when the borrower died or sold up, the bank would take 75 per cent of that increase in value, plus the sum actually borrowed. In the case of a £100,000 property that increased in value to £120,000, the amount that would have to be repaid on a £25,000 mortgage would be £40,000 - the original £25,000 plus £15,000.

Borrowing conditions are understood to be very strict with this product and there are legal and family considerations to take into account - in particular the reaction of any children, who may not like the idea of part of their inheritance going to the bank. Family Money has canvassed a number of the Irish mortgage lenders about the possibility of such an equity release product being introduced here and were told by AIB Bank, Irish Permanent and First National Building Society that they were seriously looking at a similar-type mortgage, perhaps as early as next year. However, they all expressed concerns about the legal issues involved.

Financial advisers are also worried about the introduction of an equity-release scheme, mainly on the grounds that the financial institutions will not undertake one unless there are significant profits to be made.

"Anyone looking at a scheme like this is in a very vulnerable financial position to begin with," one adviser told us. "They would need expert, independent advice before making any decision."