EQUITY release mortgages are making a comeback, according to a Worcestershire law firm.

Mark Thomson, head of financial services at Morton Fisher Solicitors, said equity release mortgages were once "reviled and dismissed as costly".

But they were making a comeback thanks to the tax planning opportunities they offered.

He said taking capital out of the equity in your house was one way of keeping money out of the hands of the taxman.

"If you take a cash lump sum in the form of an equity release mortgage and place it in a trust earning interest, you can make considerable savings on the Inheritance Tax bill due on your estate after your death," he said.

"Many people are loath to lose 40 per cent of the value of their estate over £250,000 to the taxman.

"The trust arrangements have to be in place for seven years to take full effect, but with house prices rising, more and more couples are finding that their estate is going to realise more than £250,000.

"An equity release mortgage, coupled with effective tax planning, is one way of ensuring that you don't breach the £250,000 limit."

Mr Thomson said with the stock market at one of its lowest points in years, more people would be attracted to the idea of investing their capital in unit trusts.

He said there were two kinds of equity release mortgages. In the first case, between 25 and 30 per cent of the equity in the property can be released, and is then invested in a trust.

In the second version, 25 to 30 per cent of the equity in the property is released, but the amount the building society can take is capped at 90 per cent of the property's value at the time of the deal.