What Is Equity Release?
Equity release allows homeowners aged 55 or over to unlock the cash in their property while staying in their home. Commonly used to supplement retirement income, make home improvements, manage care costs, or assist loved ones financially, this option provides a way to achieve greater financial security in later life.
Equity release explained
Equity release is a way for homeowners to access some of the value tied up in their home without having to sell it or move out. It’s a type of mortgage that allows you to release money from your property while continuing to live there.
You can choose whether or not to make repayments. In most cases, the money you borrow (plus any interest) is repaid when your home is sold after you die or move into long-term care.
The two main types of equity release are lifetime mortgages and home reversion plans. Because equity release can be complex and comes with risks, you must speak to a specialist equity release adviser or mortgage broker before going ahead.
- Lifetime Mortgages – Retain ownership of your home and repay the loan (plus interest) when you sell, move into long-term care, or pass away.
- Home Reversion Plans – Sell part of your property to a provider, but live there rent-free for life.
Consult an experienced equity release advisor to explore these options and find a plan suited to you.
How Does Equity Release Work?
Equity is the part of a property you own. So, if you have a mortgage, the equity is the difference between your home’s current value and what’s left to pay on the mortgage.
If you’re a homeowner aged 55 and over, equity release may allow you to borrow this money from your home without selling.
You can take it as:
- a lump sum (most lenders say a minimum of £10,000)
- smaller amounts taken when you need it or as a regular income – called a ‘drawdown’, or
- a combination of both.
But it can be an expensive way to raise funds. The earlier you take out an equity release product, the longer you have the loan, and the more interest builds up.
It’s a lifetime commitment that can affect:
- your future plans, including care at home
- eligibility for benefits, and
- inheritance
Before deciding, you must speak to an equity release specialist about how does equity release work, the risks or discuss other options with a mortgage adviser.
Alternatives to Equity Release
Equity release isn’t the only option to access funds in your later years. Here are some alternatives to consider with your advisor:
- Downsizing – Sell your current home and move to a smaller, less expensive property to free up cash.
- Retirement Interest-Only Mortgage – Make monthly interest payments, with the loan repaid through the sale of your property later.
- Utilize Savings or Investments – Review other financial resources before making decisions.
Our advisors are here to help you weigh every alternative to find what works best for you.
Is Equity Release a Good Idea ?
It’s tempting to focus on the immediate boost you can get from the money you unlock with equity release. Consider how it could affect your future choices and what you want to do in later life. Whether it’s right for you depends on your personal circumstances, such as:
- age
- health
- finances
- the amount you want to release
- the type of property (and its potential future value)
- your future plans
But it’s important to make sure you have enough income for your future needs.
If you simply want to raise cash, speak to a mortgage adviser about the alternatives to equity release that can help boost your bank balance.
Is Equity release Right For Me? ?
It depends on your individual circumstances. Consider the pros and cons of each option.
The pros of equity release
- Tax-free cash – Receive a tax-free lump sum or regular income.
- Optional monthly repayments – Choose whether to make repayments to reduce your final debt
- Stay in your own home – Enjoy your retirement in familiar surroundings. Use the money for home adaptations to help you stay in your own home longer as your care needs change
- Peace of mind – For joint borrowers, live in your home without penalty, or with less financial pressure if your partner passes away or moves into long-term care.
- Benefit from rising property values – Continue to benefit from the increasing value of your home (or the part you still own) without making additional payments.
- Wider eligibility – Unlike a standard mortgage, there’s no affordability assessment and the maximum age when you apply is usually less restrictive.
The cons of equity release
- Impact on benefits – Entitlement to means-tested state benefits, Local Authority Grants or Council Tax reductions could be affected.
- Higher interest rate – Lifetime mortgages may have higher interest rates than ordinary mortgages. This means debt can increase quickly.
- Application fees – There can be substantial fees to apply, including charges for advice, solicitors, valuation, and arrangement.
- Affects future care plans – You may need the equity in your property to fund long-term care for you or your partner. Releasing money early limits your options.
A mortgage adviser or equity release specialist can recommend the best choice for you.
How To Find An Equity Release Adviser ?
Equity release firms must give you certain important information to help you decide if you should enter a scheme. A specialist adviser will help you understand your choices and make the right decision for your circumstances
Find an equity release specialist using the Equity Release Council (ERC) directory Or to get support with other mortgage options, use our guide to find a professional adviser.
When contacting an adviser, confirm:
- their fees
- what other fees you’ll pay (such as legal, valuation and set up costs)
- if they search the whole market
- what type of equity release products they can offer.
Make sure you read it fully and ask them to explain anything that is unclear.
Using Equity Release for Debt Problems ?
If you are struggling to make ends meet and are looking for financial help, there are agencies and charities that provide free information and advice.
If you want to use equity release to clear debts or help with your monthly repayments, remember that the equity loan will also need to be repaid.
Why Choose Us?
We specialize in simplifying the equity release process by connecting you with reliable, FCA-approved specialists. Our mission is to provide you with a stress-free and transparent experience, ensuring you make an informed and confident decision.
Here’s why you can trust us:
- FCA-Compliant Advisors – All advisors in our network adhere to the highest standards to protect you.
- Personalized Guidance – Your circumstances are unique, and our advisors assess every detail to recommend tailored solutions.
- Stress-Free Process – Enjoy a seamless consultation experience without pushy sales tactics.
- Transparent Costs – No hidden charges or surprise fees. Know exactly what you’re paying for.
How Does the Process Work?
Our straightforward process ensures clarity and confidence at every step.
Speak with a Trusted Advisor
Connect with an experienced, FCA-approved equity release specialist.
Explore Your Options
Receive personalized recommendations tailored to your financial goals.
Unlock the Value in Your Home
Enjoy tax-free cash while continuing to live in your home.
Things to Consider
Equity release is a significant financial decision. Before proceeding, consider these key factors:
- Your Long-Term Plans – How equity release might affect care costs, inheritance, or benefits eligibility.
- Your Financial Goals – Determine how much cash you need and how you intend to use it.
- Your Property Value – Understand how changes in the property market may influence the outcome of your plan.
Working with a qualified advisor ensures you understand the pros, cons, and alternatives before making your decision.
Secure Your Financial Future with Confidence
Equity release offers a path to financial freedom, but selecting the right plan requires the right guidance. Our FCA-approved advisors are here to answer your questions, explain every option, and ensure you make a confident, informed decision.
Take the first step toward a brighter financial future today.