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.
The two most common methods of Equity Release are detailed below.
This scheme is the most popular way in which you can access equity.
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:
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.
There are four main costs associated with equity release.
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:
This is payable when you submit your application and usually depends on the estimated value of your property.
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.
Some lenders may charge an application fee. Where this is the case, we will always let you know beforehand.
Equity Release products are regulated by the Financial Conduct Authority (FCA) and overseen by the Equity Release Council (ERC).
In the case of lifetime mortgages, you always own your home and any increase in its value is yours. Plus, all Equity Release plans come with a no negative equity guarantee.
The only downsides concern the inheritance you intend to leave and any means-tested benefits you receive; they may be reduced or altered.
It is possible to release equity with a repayment option. Most lifetime mortgage providers will offer you the opportunity to make flexible repayments.
See what some of our valued customers have said about our service
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.
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.
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.
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.
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) 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 Services Register is a public record that shows details of firms, individuals and other bodies that are, or have been, regulated by the FCA.
The Financial Ombudsman Helps to resolve individual complaints between financial businesses and their customers.
Phone: 0800 023 4567
If you want your own personalised Equity Release plan, don’t hesitate to get in touch on: 0800 773 4849.
I had known Glen before as he used to sort funding on my small investment property portfolio. My wife and I had been living in Spain for several years and the Brexit situation prompted us to return to the UK. We had no UK credit rating and no provable income, so a standard mortgage was not achievable. Glen reassured us that he could arrange appropriate finance via equity release, three months later we moved into our beautiful home back in the UK. Hats off Glen we will be eternally grateful.
We had tried another well know equity released company who failed to meet our objectives. Glen was then recommended to me by a friend who he had previously looked after. Amazingly, Glen came up with a solution which worked very well for us and we were able to achieve our objectives and my wife was delighted that we were able to upgrade the property to a modern standard that met with all her friend’s approval. Top man mate!