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What is equity release?
Equity Release occurs when homeowners, aged 55 and over, withdraw equity (money) that was previously tied up in their home.
This money can be used for many things: home improvements, family gifts, a new car or that dream holiday. There is no need to move out of your home or relieve yourself of ownership to access these funds.
Equity released from your home is usually repaid when the last surviving borrower moves into long term care or passes away.
What Equity Release schemes are available?
The two most common methods of Equity Release are detailed below.
1) Lifetime mortgage:
This scheme is the most popular way in which you can access equity.
- A lifetime mortgage offers you an initial lump sum with or without an additional cash reserve for future drawdowns.
- The lender will confirm the maximum amount you can borrow.
- The money you borrow will be secured against your home, as with any mortgage.
- The mortgage is usually repaid from the sale of your home when the last surviving borrower passes away or moves into long term care.
2) Home reversion plan:
- You raise money by selling all or part of your home whilst continuing to live in it, rent free, until the last survivor passes away or moves into long term care.
How much equity can you release from your home?
For homeowners aged 55 and over, Equity Release could be the most effective way to boost your finances in later life. Subject to the age of the youngest borrower loans are available from 15% of the value of your home up to a maximum of 50%. Health and lifestyle can influence the amount you borrow subject to lenders conditions.
Find out how much you can borrow with our easy-to-use Equity Release calculator
The calculator does not consider health issues as these are looked upon independently by the lenders:
Will I be able to keep my home?
Yes, you will continue to own your own home providing you fulfil the terms of your mortgage agreement. All plans that meet the standards set by the Equity Release Council guarantee lifetime tenancy in your property, regardless of what happens to future interest rates, property values or investments.
What costs are involved when setting up a plan?
There are four main costs associated with equity release.
A. Advice fee
At Equity Released 2 U we do not charge a fee for our initial consultation. Our typical advice fee is £995 and is only payable when your mortgage completes.
To get started, use our free Equity Release calculator:
B. Valuation fee
This is payable when you submit your application and usually depends on the estimated value of your property.
C. Legal fee
We recommend that you agree a fixed fee with your solicitor once your Equity Release offer is confirmed. Typical legal fees range from £500 to £600. If you’re purchasing a property, or the legal position of your property is not straightforward, additional costs may apply.
D. Application fee
Some lenders may charge an application fee. Where this is the case, we will always let you know beforehand.
Are equity release products regulated?
Whether you are considering a lifetime mortgage or a home reversion plan, there’s a wealth of consumer protection built into the equity release market.
The industry is fully regulated by the Financial Conduct Authority (FCA), meaning all equity release brokers and lenders need FCA approval in order to do business, and there are strict codes of conduct that providers must follow by law.
Can you pay back equity release?
It is possible to release equity with a repayment option. Most lifetime mortgage providers will offer you the opportunity to make flexible repayments.
How much equity can you release from you home?
For homeowners aged 55 and over, Equity Release could be the most effective way to boost your finances in later life. Subject to the age of the youngest borrower loans are available from 15% of the value of your home up to a maximum of 60%. Health and lifestyle can influence the amount you borrow subject to lenders conditions.
Can I lose my house?
Loans are available from 15% of the value of your home up to a maximum of 60%
What if I have a complaint?
Complaints:
If you wish to register a complaint, please contact us:
In writing: The Later Life Lending Network Ltd, St John’s Court, 70 St
John’s Close, Knowle, B93 0NH
By phone: 01564 732744
If you cannot settle your complaint with us, you may be entitled to refer it
to the Financial Ombudsman Service. www.financial-ombudsman.org.uk
Why choose Equity Released 2 U?
Free fee
We don't charge you for your first consultation. There aren't any hidden fees.
Unbiased
’With years of experience in the Equity Release market, we will find you the most suitable plan or explain why Equity Release may not be right for you.
Specialist
We offer advice to all, with over 20 years of experience and hundreds of satisfied clients.
See what some of our valued customers have said about our service
Will I be able to leave an inheritance?
The amount of inheritance available will be the difference between the proceeds from the sale of the house and the amount outstanding on the plan when it’s redeemed.
We can’t predict the future value of your property so we can’t predict what inheritance will be available.
What about Inheritance Protection
Some providers offer an inheritance protection facility on their plans, which lets you protect a specific percentage of the property’s future value. Our advisor will discuss this option if one of your priorities is protecting an inheritance.
Can you lose your house?
As with all mortgage agreements and secured loans there is the risk of house repossession if you have arrears, you’re unable to repay. This is possible, however, and is a last resort once all other avenues of debt collection have been explored.
What if I have a complaint?
If you have a complaint about a financial adviser or an Equity Release provider, ask for a copy of their complaints procedure. If you have followed their complaints procedure and are unhappy with their response, or if your complaint has not been resolved after eight weeks, contact the Financial Ombudsman Service.
Useful Contacts
Law Society:
This is the independent professional body for solicitors. You can visit their website and search for a solicitor near to you.
The Equity Release Council (ERC):
The Equity Release Council (ERC) is a not-for-profit organisation that represents different types of firms involved in equity release.
This includes lenders, qualified financial advisers, solicitors and other industry professionals.
Phone: 0300 012 0239
The Financial Conduct Authority (FCA):
The Financial Services Register is a public record that shows details of firms, individuals and other bodies that are, or have been, regulated by the FCA.
Web: www.fca.org.uk
The Financial Ombudsman Service:
The Financial Ombudsman Helps to resolve individual complaints between financial businesses and their customers.
Phone: 0800 023 4567
Get in touch!
If you want your own personalised Equity Release plan, don’t hesitate to get in touch on: 0800 773 4849.